The natural rubber market here once again switched into a bear mode as the price of benchmark grade RSS-4 today quoted at Rs 88 a kg and that of ungraded sheet Rs 82. After touching season’s lowest price of Rs 84, it was quoted over Rs 90 in the spot market last week due to hectic buying for covering earlier commitments by traders.
But,this week commenced on a pessimistic note as the market might be in a bear mode and is likely to fall below Rs 80 mark.
The only factor that maintains the present price level is the strong resistance from growers who are reluctant to offer the produce at a lower price band. But, according to experts this would be a futile exercise as the market is in the midst of the main production season.
Market sources expect around 400,000 tonne rubber production during the October-January period (45 per cent of the annual production) and keeping stock for a better ‘selling climate’ will be a blunder as global economic turmoil affects the rubber-based industries especially automobile industry very badly.
There are reports from China that demand for rubber had plummeted after the Olympics and contract failures are frequent while doing business with Chinese importers.
So Thailand and Indonesia have slowed down business with China as there have been payment defaults. So, the global market for natural rubber is poised for a slowdown.
