Rubber futures test Rs 17,000 mark. Time to take positions?
14 Jun 2021
NEW DELHI: Domestic rubber prices moved in a tight range with a negative bias amid thin trade on Monday.
, rubber futures for June 30 delivery quoted at Rs 17,200 per 100 kg, down by Rs 7 or 0.04 per cent, having fluctuated around the flatline between Rs 16,960 and Rs 17,325 earlier in the day.
At this level, the contract is 3.31 per cent away from its 52-week peak of Rs 17,789 per quintal registered on May 12. It is up 11.95 per cent so far this year.
The coronavirus pandemic continues to sway the overall market sentiment in the natural rubber market, say analysts. Going forward, the lockdown in Kerala along with developments on the monsoon front are likely to impact rubber prices, they said.
“Natural rubber trended steady to weak during the week gone by and is expected to show similar sentiment in the week ahead as well. The RSS4 grade in the Indian market was held in a tight range in the futures market, while it inched lower in the spot market in lacklustre trades,” said Anu V Pai, Senior Commodity Research Analyst,
Financial Services. “It is expected to vary inside Rs 17,400-16,800 per 100 kg initially,” Pai said.
Earlier this month, the Kerala government extended the lockdown till June 16 due to the high Covid test positivity rate prevailing in the state.
Kerala is the top rubber-producing state in the country, which is the world’s second largest consumer of natural rubber behind China. India is the sixth largest producer of the commodity in the world.
Rubber is widely used across industries with heavy demand from automobiles, aeronautics, electronics, healthcare and power transmission businesses.
Should you take positions now?
MCX near-month futures can be purchased around Rs 17,100 for a target of Rs 17,500 for one week with a stop loss at Rs 16,850 per quintal, said Ajay Kedia, founder and director, Kedia Advisory.