Monday, 30 March 2015 16:36
TOKYO: Benchmark Tokyo rubber futures dropped to a nearly three-week low on Monday as slumping oil prices and weaker Shanghai futures prompted fresh sell orders amid lingering concerns about slow demand in China, the world’s top buyer, dealers said.
The Tokyo Commodity Exchange (TOCOM) rubber contract for September delivery finished 3.3 yen, or 1.6 percent, lower at 208.0 yen ($ 2) per kg. It earlier fell to as low as 206.7 yen, the lowest since March 11.
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“The market was battered by external factors such as falling prices of oil and other commodities as well as weaker Shanghai prices,” said Satoru Yoshida, commodity analyst at Rakuten Securities.
Oil prices fell on Monday as traders focused on whether Iran and six world powers would reach a deal that could add fuel to an already oversupplied market if sanctions against Tehran are lifted.
The most-active rubber contract on the Shanghai futures exchange for September delivery fell 170 yuan to finish at 12,640 yuan ($ 2,037) per tonne.
“Still, the technical chart does not look that bad. I think rubber prices are still on course for a recovery and they will move higher in the mid- to long-term,” Yoshida said.
The TOCOM futures, which set the tone for tyre rubber prices in Southeast Asia, have recovered nearly 20 percent from last year’s low of 173.8 yen, hit in October.
The front-month rubber contract on Singapore’s SICOM exchange for April delivery last traded at 142.0 U.S. cents per kg, down 0.9 cent.
Copyright Reuters, 2015
