RUBBER MARKET LIKELY TO TRADE WITHIN RANGE NEXT WEEK

By Fatin Umairah Abdul Hamid

KUALA LUMPUR, Nov 2 (Bernama) -- The local rubber market is expected to trade range-bound, with re-stocking activities balancing prices and demand amid subdued, coupled with uncertain market sentiment, said industry expert Denis Low.

He noted that despite a short supply position and rainy weather in some rubber-producing regions, last week’s rubber prices indicated low stock replenishment activities and a lack of interest in purchasing rubber.

“On a note of caution, traders and users need to be aware of and alerted about the impending Northeast Monsoon from November to January.

“If current climate change pattern is taken into consideration, what will happen during the Northeast Monsoon is certainly a cause for concern,” he told Bernama.

Low stressed that the lack of demand and stagnating prices are largely due to uncertainties stemming from geopolitical risks and fluctuating exchange rates.

These uncertainties may cause volatility in oil and gas prices, pushing certain commodity prices beyond expectations while curtailing others, he said.

“Although the US dollar remains volatile amid ongoing de-dollarisation, its long-term usage remains steady compared to other currencies,” he said.

Meanwhile, the Malaysian Rubber Gloves Manufacturers Association (Margma) expects prices to continue tracking regional rubber futures and market movements, maintaining that the outlook for the rubber market will remain mixed.

“While a weaker ringgit and potential Chinese economic stimulus could support prices, factors such as a weaker regional futures market, mixed global economic performance, declining oil prices, and trade tensions between China and the European Union could exert downward pressure,” Margma said.

The association added that further weather warnings of heavy rainfall and flooding in the coming months will add additional pressure to the market.

On a Friday-to-Friday basis, the Malaysian Rubber Board’s reference price for Standard Malaysian Rubber 20 (SMR 20) decreased by 2.5 sen to 860.0 sen per kilogramme (kg), while latex-in-bulk rose by 18.5 sen to 731.5 sen.

At 5 pm Friday, SMR 20 stood at 862.5 sen per kg, while latex in bulk was at 726.5 sen per kg.

-- BERNAMA