The Economic Times
KOLKATA: The global collapse in commodity markets has led to a slump in natural rubber prices too. Amid an overall downturn in commodity prices, India’s mostly used natural rubber variety RSS-4 fell 35% in the past one month. The popular global variety RSS-3, an equivalent of Indian RSS-4, dropped 27% in the Bangkok market within the same time span.
Reeling under the impact of global meltdown in commodity prices, RSS-4 rubber grade has now nosedived to Rs 8,800 per quintal in the Kottayam market from Rs 13,228 per quintal a month ago. Imports also come cheap. The landed price of RSS-3, originating from Bangkok, plummeted to Rs 9,127 per quintal by October-end, which was ruling at Rs 12,437 per quintal a month ago.
Its prices fell so sharply in the past one month because the global recession in the automobile market has broken out in such a time when rubber tapping too has begun in major rubber producing countries.
With crude oil prices falling continuously on a steady note, the bear grip over the natural resin market gets tightened further. Natural rubber price trails the crude oil prices as synthetic rubber is a crude oil derivative.
Expectedly, natural rubber exporters from the country are not happy with erosion in its prices in the global market. However, they keep on looking at export orders until global prices rule over the domestic prices. Today, it is ruling over the domestic price by around Rs 300 per quintal.
Concerned about the falling natural rubber prices, which may come in the way of hitting rubber export target for the current year, the Rubber Board recently convened a meeting of exporters where they have been told not to go slack in clinching export contracts, said a board official. The board has set the target for natural rubber export at 50,000 tonne for 2008-09, of which about 32,650 tonne have been exported between April-October, 2008.
Though till date no Indian importer has reneged on rubber import contracts in the event of sharp reduction in its prices, reports on contract default have started pouring in from some other rubber importing countries. This has prompted the Asean Rubber Business Council (ARBC) to take some preventive measures.
To prevent these default problems, ARBC has devised measures to restore order in the market, including distributing a blacklist of the defaulters to all members of the ARBC and advising the members to stop dealing with such defaulters.
Members have been asked to view the current situation in a proper perspective, to establish a healthy practice to enhance mutual business relationship in the long run, sources in the rubber industry said.
ARBC currently embraces rubber trade business associations from six rubber-producing countries of Asean — Thailand, Malaysia, Indonesia, Singapore, Vietnam and Cambodia — which account for 85% of the world’s total natural rubber production.
Reeling under the impact of global meltdown in commodity prices, RSS-4 rubber grade has now nosedived to Rs 8,800 per quintal in the Kottayam market from Rs 13,228 per quintal a month ago. Imports also come cheap. The landed price of RSS-3, originating from Bangkok, plummeted to Rs 9,127 per quintal by October-end, which was ruling at Rs 12,437 per quintal a month ago.
Its prices fell so sharply in the past one month because the global recession in the automobile market has broken out in such a time when rubber tapping too has begun in major rubber producing countries.
With crude oil prices falling continuously on a steady note, the bear grip over the natural resin market gets tightened further. Natural rubber price trails the crude oil prices as synthetic rubber is a crude oil derivative.
Expectedly, natural rubber exporters from the country are not happy with erosion in its prices in the global market. However, they keep on looking at export orders until global prices rule over the domestic prices. Today, it is ruling over the domestic price by around Rs 300 per quintal.
Concerned about the falling natural rubber prices, which may come in the way of hitting rubber export target for the current year, the Rubber Board recently convened a meeting of exporters where they have been told not to go slack in clinching export contracts, said a board official. The board has set the target for natural rubber export at 50,000 tonne for 2008-09, of which about 32,650 tonne have been exported between April-October, 2008.
Though till date no Indian importer has reneged on rubber import contracts in the event of sharp reduction in its prices, reports on contract default have started pouring in from some other rubber importing countries. This has prompted the Asean Rubber Business Council (ARBC) to take some preventive measures.
To prevent these default problems, ARBC has devised measures to restore order in the market, including distributing a blacklist of the defaulters to all members of the ARBC and advising the members to stop dealing with such defaulters.
Members have been asked to view the current situation in a proper perspective, to establish a healthy practice to enhance mutual business relationship in the long run, sources in the rubber industry said.
ARBC currently embraces rubber trade business associations from six rubber-producing countries of Asean — Thailand, Malaysia, Indonesia, Singapore, Vietnam and Cambodia — which account for 85% of the world’s total natural rubber production.
No comments:
Post a Comment