physical closing prices(FOB) at 5.00PM ON 18/02/19
Offer Price (US Cents/Kg)
SELLERS
SMR CV 190.60
SMR L 185.65
SMR 5 136.40
SMR 10 133.90
SMR 20 133.40
Tone Market: Rangebound
Centrifuged Latex: Local Price (ISO 2004) in Sen/Kg(Wet)
Latex In Bulk Sellers
390.00
Paper market
Settled/Closed Volume(mt)
SHFE 11630 32444
TOCOM 182.8 238
SICOM (RSS3) 161.0 31
SICOM (TSR20) 133.0 2,024

Rubber Main Events

marzo 5 - marzo 7
Tire Technology Expo 2019 - Hannover, Alemania


marzo 18 - marzo 19
World Rubber Summit 2019 - Singapore Expo, Singapur


julio 24 - julio 26
Latin & Caribbean Tyre Expo 2019 - Centro de Convenciones Amador en Panamá.


Septiembre 10 – septiembre 12
IRC2019 - International Rubber Conference – Londres, Reino Unido


Octubre 7 – octubre 10
International Elastomer Conference 2019 – Cleveland, Ohio


Noviembre 11 – noviembre 15
XV Jornadas Latinoamericanas de Tecnología del Caucho – Querétaro, México

Financial & Market News

 

Crude oil:  From the WEF in Davos, the CEO of the United Arab Emirates-based Crescent Petroleum, an oil and natural gas producer, sees this year’s prices remaining volatile: "It will be in this $60 to $80 range," (presume Brent) but subject to huge fluctuations, price prediction likely “as hard as it has ever been, the most volatile in 30 years, partly because of certain tweets (dig) but also because there isn't much spare capacity, $90 more likely than $40.” It was certainly another undecided day on the ping-pong table as WTI ranged from $52.07 to $53.42/bbl, Brent at $8.05 more, but ending the day nearer its best, and that after yesterday’s API statistical release that showed U.S. crude stocks rising by 6.6 million barrels last week, where a fall of 42,000 barrels had been forecast or expected. The day featured the now-usual battle between economic slowdown on the one hand and sanctions, OPEC+ cuts and now the U.S. threat of sanctions on OPEC member Venezuela on the other. Investors see supply as fairly tightly balanced against demand, but are undermined by lack of growth concerns. The government EIA’s US stock figures release early evening underlined the earlier API’s issue, noting an even larger 8m barrel crude inventories increase on the week, with gasoline stocks increasing by 4.1 million barrels, distillate inventories, including diesel and home heating fuel, falling by about 600,000 barrels. But it seems that the evening’s stronger influence on crude is Two-Presidents Venezuela, the incumbent Maduro breaking off diplomatic relations and giving U.S. diplomatic personnel 72 hours to leave the country, the U.S. State Department (along with many others), preferring to recognize opposition leader Juan Guaido as the country's interim president, saying it wouldn’t comply with that order. What fun! Hello sanctions! Or helicopters.


Gold:  ended its day at just above the middle of a $1275.30 to $1283.90/oz range, struggling with a stronger dollar and with the psychological hurdle, something of a tug-of-war, explained by one metals analyst:  "I think the market doesn't believe, at least yet, that there's a case for gold to go above $1,300 ... The dollar is still relatively strong," so “Gold still faces short-term headwinds,” as it’s “only one of the beneficiaries of renewed interest for safe havens from market volatility,” while others see that, "The macro-economic backdrop is more positive for gold, which we think will continue to benefit from safe-haven demand this year," forecasting gold prices “at $1,350 by end-2019,” adding that "Investor inflows look set to continue given our expectation of further falls in global equity markets and slower economic growth." Our regular technical analyst: “Spot gold could retest support at $1,278 an ounce, a break below which could cause a loss to the next support at $1,266.” Clear? Good. 


Equities:  All but two of Asia’s exchanges closed higher Thursday despite the uncertainties but while the Korean market was best at 0.81 percent up, the mainland Chinese markets recovered from earlier losses to finish in the 0.40’s positive., but sentiment remains hesitant over the on-off trade negotiations. European bourses did close up in a 2:1 ratio but none beat the one percent mark in either direction, the three main ones 0.35 percent down to 0.65 percent up, politics, banking and ECB under scrutiny, Mr. Draghi’s actions and warnings hardly helping, the Dow’s jittery performance adding to uncertainties as a positive start on Wall Street soon evaporated, the Dow itself down 150 points, the Nasdaq up a fraction, the S&P 500 at 0.40 percent off.    


General economic/political ribbon:  The White House’s economic adviser Kevin Hassett said that the U.S. economy “could register zero growth in the first three months if the partial government shutdown lasts the whole quarter.” So far, it’s into its 34th straight day. Morgan Stanley’s CEO said it will be "extremely negative" for the U.S. “if the shutdown continues for much longer” and "If it goes on through months of this year, it's going to have an extremely damaging effect" on the U.S. economy. But for today, weekly jobless claims fell to 199,000 last week, their lowest in 49 years.

Market Commentary

 

Rubber Market:  ‘Things’ aren’t really getting any better in terms of influence on market sentiment. Whether next week’s Washington talks on the US-China trade issue are on or off, the portents don’t look too bright. Commerce Secretary Wilbur Ross said today that the U.S. is still "miles and miles" from any trade deal with China and that, "Frankly, that shouldn't be too surprising," as they still have "lots and lots of issues," the administration needing to create "structural reforms" and "penalties" if they’re to resume normal trade relations with Beijing, adding that, "We would like to make a deal but it has to be a deal that will work for both parties," and concluding that, "We're miles and miles from getting a resolution." And that would be? The list certainly starts with what the Commerce Secretary called America's "intolerably big trade deficit" with China, which last year settled, or ‘ballooned’ to  $323.3 billion if we go on Chinese government figures released earlier this month, the worst imbalance on record dating back to 2006. And it the moves on to the future in the shape of China’s 2025 plan that says it has to try to dominate the world’s high tech industries. Mr. Ross says “We have to protect (against) that," continuing, "The third area is American companies doing business in China should have market access, should have a level playing field, should not be subject to disrespect for their intellectual property rights." So will the March trade deadline be extended?  Mr. Ross: "It's difficult to prejudge where we'll be in that point in time. But as that date approaches, the President and those of us who are dealing with the trade issues will get together and have a very serious discussion on where we stand at that point." His President has already said that punitive tariffs on “roughly half of all Chinese exports to the US”, should the two parties not agree a permanent solution, “will be reinforced.” So, like Brexit, probably in limbo until the end of the first quarter: just what everyone who has to make commercial plans needs. 

 

Paper Markets:  Bland. Shanghai’s sentiments can’t be concentrated on its market at the moment as that suffered another empty day, its benchmark down $1 on the day session and up $4 on the late one, only four of its positions trading, and only two of those that you’d notice. Ditto Tocom, unless in relative terms $7 up on RSS3 and $$9 on STR20 can be considered as signs of life. The RSS3 contract once again broke downside support and didn’t recover it at its closing. Albeit rare these days, it was beaten for turnover by a Singapore market whose embarrassing RSS3 contract was unchanged to $25 up (and that on 40 tons, no less!) while its TSR20 counter was either $2 up or $3 down, but its spot grade differential, at $282 in favor of the sheets, was at its widest since May 9th last year.           


Tocom kerb: June 2019 RSS3 last closed at 182.1, the intraday swing $28
Resistance remains at:  190.0, 202.1 and 216.3
Support remains at     :  182.6, 176,6 and 170.5 (182.6 broken again and while closing higher than yesterday, still below the 182.6 support mark)                        
                          July 2019 TSR20 closed at 153.2, the intraday swing $26


Shanghai daily open position: May +15,180mt

 

The Tire Majors: appeared busy, March trading at $39 to $44 over closing settlement, May at $27 to $32 over.

Disclaimer: This report is strictly for information only. INPOL is not liable for any inaccuracies, errors or omission in the report. This report is intended for general circulation and does not constitute an offer or solicitation to buy or sell any investment or commodity product(s). It does not take into account the specific objectives, financial situation or particular needs of any person. Investors should seek advice from a financial or commodity adviser before investing in any investment products or adopting any investment strategies.