BANGKOK, Nov 25 (Reuters) – Tokyo rubber futures recovered from early losses, tracking a recovery in oil prices, while falling supply in producing countries encouraged players to take speculative buying positions, dealers said on Wednesday.
* The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> — for May delivery from Wednesday — rose 3.4 yen from an opening price of 248.5 yen to settle at 251.9 yen ($2.85) per kg. * “Players took speculative buying positions after seeing a rebound in oil prices,” one dealer said.
* In theory, high oil prices make an alternative petrochemical product, synthetic rubber, expensive, and usually encourage users to shift to natural rubber.
* Oil rebounded above $76 a barrel on Wednesday, after falling 2 percent a day earlier on disappointing U.S. growth and data showing a big build in crude inventories, signalling weak demand in the world’s top energy user. [ID:nSIN418570]
* Falling supply caused by monsoon rains in Thailand, the biggest producer, and dry weather in Indonesia, the second biggest, still supported TOCOM prices, traders said.
* TOCOM prices were expected to rise further on Thursday as technical sentiment improved after prices broke above the key psychological level of 250 yen per kg, they said. ($1=88.34 Yen)

Source: Reuters

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