Asian rubber prices vulnerable to further fall<\/p>\n
SINGAPORE (Reuter): Southeast Asian rubber prices, weighed
\ndown by rising supply from the post-wintering harvest, are
\nvulnerable to further declines unless significant buying is
\ntempted to emerge, traders said yesterday.<\/p>\n
One trader at a Singapore house predicted at least a five
\npercent retracement in prices from current levels by late May in
\nthe absence of bullish news and as rubber trees return to full
\nproduction following the wintering period when latex flow slows.<\/p>\n
Traders said although there could be some slight upward
\ncorrection on bargain-hunting and short-covering, this was
\nunlikely to alter the immediate negative trend.<\/p>\n
Unseasonal rains in Indonesia may help halt sliding prices but
\nthey are unlikely to push them higher, they said.<\/p>\n
Malaysian and Singaporean trade is expected to remain quiet in
\nthis holiday-shortened week. Both markets were lower yesterday,
\ndragged down a sharp fall in Tokyo prices on the yen's surge
\nagainst the dollar.<\/p>\n
Thai rubber prices are also seen coming under pressure due to
\nincreased supplies, Japan's Golden Week holidays and the absence
\nof Chinese demand.<\/p>\n
The Singapore trader said: \"I can't think of any bullish
\nfactors in the market. Consumers are very quiet with the holidays
\nand most are fairly well-bought.\"<\/p>\n
\"One large rubber consumer has been buying heavily forward in
\nthe past few weeks and of course that has stopped.<\/p>\n
\"No one is complaining of a shortage of rubber. There could be
\na slight shortage in Medan due to wintering but this is being
\noffset by good production from other areas in North Sumatra.<\/p>\n
\"Thai production is a bit better. Overall, I see another five
\npercent drop in prices for the next three weeks,\" he said.<\/p>\n
Indonesia<\/p>\n
But traders in Indonesia said prices might be able to hold
\ncurrent levels helped by lower supply in some areas.<\/p>\n
They said benchmark SIR20 rubber prices were likely to remain
\nat between 58.00-58.25 U.S. cents\/lb in Palembang, 58.25-58.75
\ncents in Medan, 58.00-58.25 in Pontianak and at 57.75-58.00 cents
\nin Surabaya and Jambi.<\/p>\n
But traders in Singapore valued the market lower at 57.50
\ncents in Belawan and 57-57.25 cents in Padang and Palembang.<\/p>\n
Indonesian dealers said lower supply followed unexpected rains
\nin Jambi and other key production areas.<\/p>\n
\"Rains continue falling almost day and night here confounding
\nour previous expectation,\" one dealer in Jambi said.<\/p>\n
The dealer said supply in Jambi was likely to fall to around
\n7,000 tons in May from between 8,000-9,000 tons in April.<\/p>\n
European buyers are expected to remain active in the market
\nfor SIR20 grade, particularly in Palembang, albeit for small
\nquantities, traders said.<\/p>\n
The latex market is likely to stay quiet. Latex was last
\ntraded in the local market at Rp 2,550\/kg. One latex dealer in
\nMedan said he expected to ship some 1,000 tons of latex to
\nGermany at US$1.15\/kg in the next two months.<\/p>\n
Malaysian dealers said only month-end short-covering might
\nstave off falling rubber prices this week.<\/p>\n
\"Buying interest is rather poor for the moment, save for some
\nhand-to-mouth needs,\" a dealer said. \"If prices are to rebound,
\nthere's got to be some substantial buying,\" he added.<\/p>\n
A major Thai exporter in Hatyai said: \"More domestic supply
\nwill come in while the market remains quiet. Well stocked
\nJapanese buyers can afford to stay out.\"<\/p>\n
Thai benchmark RSS-3 for June\/July shipment eased to $1.38-1\/5
\na kg FOB Bangkok on Friday from $1.40 a week ago.<\/p>\n
\"The Chinese only made inquiries without placing actual
\norders. Some Thai exporters are also wary of selling to them
\nbecause of their uncertain payment records,\" a trader said.<\/p>\n
Thai traders said the bulk of orders they received last week
\ncame from tire-maker Bridgestone, but they added that the orders
\nwere not substantial.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/asian-rubber-prices-vulnerable-to-further-fall-1447893297",
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