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MARKET NEWS & UPDATES

*Sentiments were sanguine in the natural rubber market in the week gone by bolstered by China stimulus, rebound in crude oil prices and on concerns over presence of leaf disease in the top natural rubber growing country, Thailand.

*Japan's Osaka rubber futures bounced up from the 11-weeks lows to end the last week's session in green. SHFE rubber futures too posted gains, for the second straight week.

* RSS4 grade rubber in the Indian market traded mostly steady with a positive bias.

* As of 22 December, rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 3.4 % to 186201 tons from previous Friday.

* Malaysia’s natural rubber (NR) production increased by 0.6 per cent to 32,944 tonnes in October 2023 from 32,757 tonnes in September 2023, said the Department of Statistics Malaysia (DoSM). Year-on-year (y-o-y), NR production increased by 3.6 per cent from 31,795 tonnes in October 2022. Total NR stocks in October 2023 decreased by 0.4 per cent to 152,396 tonnes as compared to 153,011 tonnes in September 2023. Exports of Malaysia’s NR decreased 1.0 per cent month-on-month to 56,460 tonnes in October 2023 against 57,028 tonnes in September 2023. China remained the main destination for NR exports, which accounted for 58.9 per cent of total exports in October 2023, followed by Germany (8.5 per cent), Iran (3.5 per cent), Portugal (2.0 per cent) and Turkiye (1.8 per cent).

* Vietnam raked in US$2.51 billion from the export of 1.87 million tonnes of rubber during the 11-month period of this year, down 0.2% in volume and 14.9% in value compared to the same period from last year, according to the General Statistics Office (GSO). November alone saw the country export 250,000 tonnes of rubber for US$343 million, up 14.5% in volume and 16.6% in value against October, reported the GSO. The average rubber export price in November reached US$1,370 per tonne, marking a rise of 1.8% month on month and up 1% year on year. Experts of the Vietnam Rubber Association say rubber exports this year will struggle to meet the set target of US$3.5 billion. China remains the country’s primary export destination, accounting for over 99% of the total figure.

* China's government said on Dec 11 that it has started offering insurance for natural rubber producers, to encourage higher output and increase the country’s self-sufficiency rate in producing the latex used to make tyres. The scheme for producers in Hainan and Yunnan provinces, the main rubber producing regions, will stabilise producers’ income and increase planting acreage to boost the country’s rubber production, according to a joint statement by the finance ministry, agriculture ministry and the National Administration of Financial Regulation dated Dec 8. China is the world’s largest natural rubber consumer and a significant importer. Its domestic supplies so far only fulfil a fraction of its needs. The country is expected to produce 836,000 metric tons in 2023 and up to 910,000 by 2030, Jom Jacob, co-founder of India-based analysis firm What Next Rubber, said. “Trees attaining tappable maturity until 2030 are already planted. It means, production capacity cannot be increased for the period up to 2030 as newly planted rubber trees have a long gestation period,” he said. The insurance covers rubber seedlings and trees against natural disasters, major diseases, pests and rodents, accidents, wildlife destruction and other risks faced by rubber seedlings or rubber trees, the government said.

* The Malaysian Rubber Board (MRB) and Singapore-based technology company Agridence Rubber Pte Ltd have tied up in a technical collaboration to set up a digital trading platform for sustainable natural rubber.

* The Rubber Board under the Union ministry of commerce and industry has set an ambitious target of setting up rubber plantations on 10,000 hectares of land across north Bengal in next two years to augment rubber production in the country. Senior board officials said they would spend around Rs 50 crore in the two years to develop plantations on the 10,000 hectares.

The bounce back seen after taking support at 230 ranges could stretch towards 256/275 ranges. However, a voluminous rise above 280 is required for continuation of upward momentum. Inability to clear the same may call for a retreat. In the meantime, a direct fall below 210 could intensify weakness.