Natural rubber pricing rally loses steam

Tokyo – Natural rubber (NR) future pricing remained flat during the trading week ended 27 Oct, with all major Far East markets posting week-on-week declines.

Recent "bullish market sentiment" has been replaced by speculative selling and profit-taking,” Japan Stock Exchange (JPX) noted in its weekly market review.

In Osaka, rubber futures fell by 1.0% week-on-week in “quiet trading” on Japan’s OSE exchange, according to the report issued 30 Oct.

Trading volume decreased on the OSE while 'open interest' dropped to “its lowest level since 1969 due to accelerated position liquidation,” commented JPX.

On China’s SHFE and INE commodity exchanges, rubber futures prices dropped by 0.3% and 1.7% respectively, while Singapore’s SICOM rubber futures declined “marginally”.

In Singapore, JPX explained, prices “failed to sustain the recent rally," leading to 'long liquidation'.

Summarising market trends, JPX said rubber futures prices had “moved from overbought conditions to a more neutral level, leading to price consolidation.”

Official warehouse rubber stocks increased at SHFE and INE, with producers capitalising on the recent rally to sell and deliver physical rubber.

This, said JPX, resulted in a 4,123-tonne rise in rubber stocks at the SHFE and a 3,448-tonne increase at the INE.

Selected NR futures price trends on major trading exchanges