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TOKYO, Sept 24 (Reuters) – Key Tokyo rubber futures closed down about 2 percent but a touch above the day’s low on Wednesday, as economic uncertainty fanned by the U.S. financial crisis rekindled fears about demand for the industrial commodity.
* The key Tokyo Commodity Exchange rubber contract for February 2009 delivery <0#JRU:> fell to an intraday low of 288.5 yen per kg, down 8.1 yen or 2.7 percent from Monday. It closed at 290.1 yen.
* Tokyo financial markets were closed on Tuesday for a national holiday.
* “Funds are reluctant to invest in risk assets, so rubber is under pressure. General sentiment for rubber is still very bearish,” said Jun Nishimuta, analyst at Kanetsu Asset Management in Tokyo.
* “Concerns about the U.S. economy have not been erased, and the market just doesn’t have the strength to move above 300 yen,” a second analyst said.
* The benchmark contract for rubber, which is mostly used to produce tyres, has been trading below 300 yen for about a week.
* Key TOCOM rubber faced some technical resistance at its 10-day moving average of about 295.5 yen, though the market was keen to see whether the key contract could fill in a chart gap to 300.0 yen created when it dropped sharply on Sept. 16.
* The spot September contract expired at 380.1 yen a kg with 6 lots of deliveries, in the highest expiry price and the lowest delivery volume since November 1984 when three exchanges for textiles, gold and rubber were merged to form TOCOM.
* “There are traders that want rubber, but there are just not enough physical supplies,” an official at Kanetsu Asset said.
* He said that supplies depleted by wintering when latex production falls usually return to normal at least by mid-May, but that the process has been particularly slow this year.
* Strong oil prices and firmer physical rubber prices due to tight supplies were providing some support to TOCOM rubber futures.
* U.S. light crude for November delivery rose above $108 a barrel after settling at $106.61 on Tuesday, lifted by a forecast of a drop in U.S. crude stocks. [O/R]
* The dollar was trading at 106.15 yen versus late New York levels of 105.71/76 yen. [USD/]
PRICES OF ASIAN PHYSICAL RUBBER COMPARED WITH MONDAY
Grade Price Change
Thai RSS3 (Oct) $2.87/kg unchanged
Thai RSS3 (Nov) $2.87/kg unchanged
Thai STR20 (Oct) $2.87/kg unchanged
Thai STR20 (Nov) $2.87/kg unchanged
Malaysia SMR20 (Oct) $2.87/kg +$0.03
Malaysia SMR20 (Nov) $2.87/kg +$0.03
Indonesia SIR20 (Oct) $1.28/lb +$0.01
Indonesia SIR20 (Nov) $1.28/lb +$0.01
Thai USS3 91 baht/kg -1 baht
Thai 60-percent latex (drums, Oct) $1,950/tonne -$40
Thai 60-percent latex (bulk, Oct) $1,850/tonne -$50
Source: Reuters