[Dow Jones] Tocom RSS3 rubber futures settle lower on long liquidation, short selling, stronger yen but recover partially from intraday lows. “The market is being guided by speculation; investors go short and then some of them cover their positions to take profits,” says analyst in Singapore. Stronger yen, weaker crude oil have prompted many investors to go short on rubber futures, says Tokyo-based trader. Benchmark Tocom November RSS3 contract settles Y1.8 lower at Y157.7/kg after hitting intraday low of Y155.3/kg. Traders put immediate support at Y155/kg.

Source: Dow Jones

TOKYO, June 19 (Reuters) – Japan’s crude rubber inventories totalled 9,933 tonnes as of June 10, down 1.9 percent from May 31 when inventories topped 10,000 tonnes for the first time since late March, industry data showed on Friday.
The latest data marks a 7 percent drop from a year earlier, the data from the Rubber Trade Association of Japan showed.
Steady shipments have recently kept inventories low, although demand for rubber has slumped due to the economic downturn, which has forced automakers to cut production.
Following are details of the association’s latest data:
June 10 May 31 May 20 May 10 Apr 30 Crude rubber 9,933 *10,127 9,526 9,416 9,484 Natural Latex 400 407 402 401 422 Synthetic
(solid) 1,163 1,300 1,245 1,413 1,474 Synthetic Latices
(D.R.C.) 23 23 23 23 23
* The association revised up its crude rubber inventory data for May 31.

Source: Reuters

VIENTIANE, June 19 (Reuters) – Tokyo rubber futures, which set the tone for physical prices, are technically bullish and could potentially challenge the 200 yen per kg level again, analyst Daryl Guppy said on Friday. “The key factor is a move above 180 in TOCOM gives you an upside target around 260,” Guppy, director of Guppytraders.com, told Reuters on the sidelines of a regional rubber conference in the Laotian capital.
“Within TOCOM and within the rubber markets, the context is a steady upward rising trend. Remember, they are long-term targets, so they are not going to happen tomorrow or whatever,” he said.
The most active contract on TOCOM, currently November 2009 , last traded around 180 yen in November of 2008 and hovered around 260 yen last October. The contract was around 160 yen per kg on Friday.
A Reuters poll showed that purchases by tyre makers, steady demand from main consumer China, tight supplies in Southeast Asia and high oil prices are expected to push up rubber prices in June. [RUB/POLL]
“We expect to see some consolidation at 260-280 yen. A move above 280 and a longer-term price gives us 320-340 target,” said Guppy.
Tokyo rubber futures, whose movements are often dictated by the yen and oil prices, hit a 28-year high at 356.9 yen per kg in late June of 2008.
The market tumbled to a six-year low in December on fears of falling demand for cars during the global economic slowdown before rebounding to current level, partly driven by China’s buying in the physical market.
“China is the essential factor in world recovery. China market has the strongest and most sustainable recovery of any global market,” said Guppy.
China’s demand for rubber is expected to rise 8.5 percent in 2010 to reflect strong growth in the country’s auto sector, the president of China’s Rubber Industry Association said.

Source: Reuters

TOKYO, June 19 (Reuters) – Key Tokyo rubber futures rose towards 160 yen on Friday in slow trade, helped by stronger crude oil prices and a recovery in the dollar against the yen.
* On Thursday, the benchmark contract dipped to its lowest in almost five weeks at 157.5 yen per kg as a firm yen weighed on investor sentiment. But the dollar recovered against the yen on Friday prompting earlier sellers to unwind positions.
* The key Tokyo Commodity Exchange rubber contract for November delivery <0#JRU:> settled at 159.5 yen per kg, up 1.3 yen or 0.8 percent from the previous day.
* It fell 5.3 percent on the week, marking the second week of retreat.
* “There is no significant activity in the rubber market. Prices have been basically hovering at around 160 yen in the past few days,” said Shuji Sugata, a manager in Mitsubishi Corp Futures and Securities’ research team.
“The 155-160 level is where we saw prices stop falling in late May, so that’s the technical support level,” he said.
* Traders said low open interest on TOCOM has kept both speculators and industry participants from trading actively.
* Open interest in TOCOM rubber futures fell to 24,603 lots on Friday, down 20 percent from 31,006 lots two months earlier.
* “Given such low open interest, the market has hardly any depth and only follows ups-and-downs in other markets,” Sugata said.
* Crude oil rose toward $72 a barrel on Friday, extending its gains of a day earlier on bullish U.S. economic data and supply concerns in OPEC member Nigeria. [O/R]
* The dollar climbed 0.3 percent to 96.80 yen, holding firm after Wall Street gained the previous day to break a three-day losing streak and prompted traders to cover their yen long positions across the board. [USD/]
* TOCOM said earlier this week that the launch of a new, faster trading platform in May together with the introduction of a circuit breaker and an extension in trading hours has had little impact on the rubber market. [ID:nSP13615]
* Japan’s crude rubber inventories fell 1.9 percent in the 10 days to June 10 to 9,933 tonnes, industry data showed on Friday. [ID:nT66748]
* In the physical market, prices were little changed, although irregular weather could lead to a supply shortage. In Indonesia, rubber trees are being hit by an earlier-than-usual dry season, which could impact output in the world’s second-biggest producer, an official at the country’s rubber association said. [ID:nJAK82903]
* There was a minor bright spot in demand for rubber gloves. Malaysia’s No.2 rubber glove maker Supermax has seen demand for its products jump by around a third as a flu pandemic boosts sales, its chief said. [ID:nKLR412040]
* China’s demand for natural and synthetic rubber was expected to rise 8.5 percent, or by 6.4 million tonnes, in 2010 to reflect strong growth in the country’s auto sector, the president of China’s Rubber Industry Association said on Friday. [ID:nSP449300]
* China consumes 16 percent of the world’s natural rubber.
* Underlining expectations that global tyre demand will recover, German automotive supplier Continental said it expects worldwide demand for passenger car tyres to grow 4 percent next year.
* Continental’s Passanger Tyre division head told a German magazine that it expects worldwide demand to increase to nearly 1.25 billion units next year from the 1.2 billion units it expects this year.

Source: Reuters

[Dow Jones] Tocom RSS3 rubber futures settle lower at one-month low, below crucial psychological mark of Y160/kg as traders set up short positions taking leads from stronger yen. “All commodities in Japan are witnessing downward pressure due to the strengthening of the local currency,” says Tokyo-based trading executive; adds stronger yen likely to make natural rubber imports cheaper but may not necessarily push up demand as local economy still weak. USD/JPY was around 95.63 in spot market but traders say pair could test 95.00. Benchmark Tocom RSS3 rubber futures settle Y3.2 lower at Y158.2/kg after moving to intraday low of Y157.5/kg.

Source: Dow Jones