Natural rubber prices tumble, follow global market cues

Kochi : Natural rubber (NR) prices tumbled heavily on Monday, mainly on account of the sharp fall in prices in the overseas markets. The market of RSS-4, the Indian bench mark grade, on Monday quoted Rs 210 a kg, lower by Rs 6 from last week’s closing rate. The Indian market just followed the footsteps of the global queues as prices are diminishing in major international markets including Tocom and Bangkok. The Bangkok market on Monday quoted Rs 209, a kg which influenced the Indian futures counters heavily, hence the sharp fall in on Monday’s spot trading. On June 1st the local spot market quoted Rs 224 and that went up to Rs 228 on 16th of this month. The monthly average price went up to Rs 238 in April. On June 1st the global price was Rs 236 and this even went up to Rs 248 in April.

The demand for the RSS-4 grade has been paralysed for the last few weeks as the offtake from the tyre industry was rather low. This happened due to the decrease in demand for tyres from the automobile sector. The set back in the sales of auto sector during last 5-6 months had heavily impacted the demand from the original equipment (OE) sector. According to a leading rubber trader, based in Kottayam the order book of the tyre companies was lower for the last 8-10 weeks and he expect a further fall in prices in the coming weeks. A leading Kochi based dealer said that tyre industry is now opting to import SMR-20 (ISNR-20) grade which is cheaper than the RSS-4 grade and having no serious issue on the quality front.