Rubber prices forecast to continue increasing<\/p>\n
SINGAPORE (Reuter): Southeast Asian traders said yesterday
\nrubber prices are expected to continue rising this week as demand
\nfrom Japan, China and Western tire companies exceeds supply.<\/p>\n
\"Because of the rain in September and October many shippers
\ncould not conclude their contracts. Now they have to find raw
\nmaterials to fill the contracts, there's more demand than
\nsupply,\" one Thai trader said.<\/p>\n
Rubber should therefore remain bullish, particularly as
\nJapanese brokers are forecasting higher prices there and as
\nChinese enquiries continue to bolster the market, he said.<\/p>\n
Prices were pushed higher last week tracking markets in Tokyo
\nand Kobe and as local shippers scrambled for supplies to fulfill
\nstrong demand due to contracts delayed by shortages over recent
\nmonths, brokers in southern Thailand said.<\/p>\n
\"Prices went higher and higher...The main reason was the
\neffect from Japan where the price was shooting up every day,\"
\nsaid one trader.<\/p>\n
The supply situation is improving as the rainy season draws to
\na close but local prices are still rising.<\/p>\n
\"A lot more raw materials are coming on to the market but
\nprices are still going up,\" the trader said.<\/p>\n
Thai benchmark RSS-3 firmed to around $1.52\/kg for December-
\nMarch shipment compared with around $1.50\/kg-$1.51\/kg last week.<\/p>\n
Malaysian traders said they also expected the rubber market to
\nextend its rally this week in anticipation of more enquiries from
\nAsian and Western buyers and tight domestic supply due to
\nflooding in key production areas.<\/p>\n
\"The market was supposed to undergo a correction to the recent
\nrun-up but the resumption of Chinese buying turned sentiment
\ntowards the end of the week,\" one trader said.<\/p>\n
\"The market now looks strong and people are optimistic prices
\nwill surge despite this being the peak production period for
\nrubber,\" he added.<\/p>\n
He said Chinese buyers were actively looking for more SMR and
\nsheet rubber for November through to January shipments.<\/p>\n
\"We feel China needs more rubber to replenish its stock.\"<\/p>\n
Indonesian market<\/p>\n
\"The Chinese are also in the Indonesian market where prices
\nare much cheaper than in Malaysia. They are also interested in
\nThai RSS3 but there is a shortage of raw materials there,\"
\nanother trader said.<\/p>\n
Apart from China, South Korean, European and American tire
\nmanufacturers are likely to buy for immediate requirements due to
\nfears of short supply in most producing countries.<\/p>\n
\"Rain continues to fall in most rubber growing areas in
\nMalaysia and there are reports of floods in Thailand,\" one trader
\nsaid. Dealers said local Malaysian production could have fallen
\nby up to 40 percent in October.<\/p>\n
December RSS Ones buyer was quoted at 382 cents on Friday
\nversus 376.50 a week previously, and December SMR 20 buyer at 366
\nagainst 357 previously.<\/p>\n
Indonesian traders said local rubber prices are likely to
\nremain steady in the coming week, on export demand from U.S. and
\nEuropean tire-makers. Tire-grade SIR20 was forecast to trade in a
\n64.00-66.50 U.S. cents\/lb range in the coming week compared with
\n62.00-64.00 U.S. cents\/lb last week, they said.<\/p>\n
An executive at one U.S. tire firm agreed that regional rubber
\nprices were still on the rise, but said the factors underlying
\nthe rise were not as bullish as reported.<\/p>\n
\"There is quite a lot of rubber around, but prices are still
\ngoing up on talk of Chinese buying and rains in Malaysia. But the
\nrains are quite normal around this time of the year and the
\nrumors of Chinese buying (of Thai and Indonesian product) are not
\nconfirmed,\" he said<\/p>\n
The tire executive said Western consumers were not buying on
\nany scale as the U.S. economy was slowing. Japanese demand was
\nstagnant and China was reported to be facing foreign exchange
\nproblems so it would not be buying as much as expected, he added.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/rubber-prices-forecast-to-continue-increasing-1447893297",
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