Asian rubber markets go into hibernation<\/p>\n
SINGAPORE (Reuter): Regional rubber markets began hibernating
\nyesterday ahead of next week's Lunar New Year holidays and
\ntraders said production stoppages and current wintering could
\nkeep prices steady to slightly up.<\/p>\n
But the longer-term trend could be clouded by a higher post-
\nwintering harvest, ample origin stocks and weakening consumer
\ndemand, they said.<\/p>\n
"Activity is virtually at a standstill from this week. I don't
\nsee much major price movements," one Singapore dealer said.<\/p>\n
"Prices will remain steady to slightly higher until after the
\nholidays because of loss of production days and wintering," he
\nsaid. But the market could see some downward pressure once
\ntappers return from the holidays.<\/p>\n
Trading in Indonesia, Malaysia, Singapore and Thailand resumes
\non Feb. 26. The markets in Indonesia, Malaysia and Singapore will
\nalso be shut for the Moslem holiday marking the end of Ramadhan,
\nwhich this year coincides with Chinese New Year.<\/p>\n
Traders said they had heard the Thai and Chinese governments
\nhad agreed in principle on a new long-term rubber purchase deal,
\nbut that the pact lacked specifics, such as contract volume and
\nprices.<\/p>\n
"Thailand agreed to sell and China agreed to buy rubber but
\nthere was no mention of volume and other details," a Singapore
\ndealer said. "Probably, they don't want to put anything in stone
\nany more."<\/p>\n
In recent years, Thailand faced difficulties in meeting its
\nsupply commitments to China. That meant it sometimes had to incur
\nheavy losses by buying expensive rubber in the open market and
\nselling it to China at lower prices.<\/p>\n
Traders said this year's wintering -- the seasonal phenomenon
\nwhen trees shed leaves and production declines -- began earlier
\nthan usual in Malaysia and Thailand.<\/p>\n
Traders said the wintering, expected to be brief and mild,
\ncould be followed by a secondary leaf fall in April.<\/p>\n
Thai traders said wintering and fresh Japanese orders kept
\nlocal prices firm last week, with benchmark March RSS3 rising to
\n153 U.S. cents a kg from 150 a week earlier.<\/p>\n
"The firmer price is due to perceived tight supply here. And
\ndespite the approaching Lunar New Year, we received some orders
\nfrom Japan," a trader at Teck Bee Hang Co Ltd said.<\/p>\n
Another trader said wintering was sweeping most rubber growing
\nareas in the south, but said it should be over by early March.<\/p>\n
In Indonesia, traders said the market was depressed by poor
\nbuying interest by the major buyer, the United States.<\/p>\n
"Demand from the United States is likely to remain weak
\ndespite an expected sufficient supply of rubber," one dealer in
\nMedan said.<\/p>\n
SIR20 was likely to hover at 64.50-66 U.S. cents a lb this
\nweek in Medan and other major Indonesian ports, dealers said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/asian-rubber-markets-go-into-hibernation-1447893297",
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"sponsor_url": "https:\/\/okusiassociates.com"
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