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TOCOM rubber slips after Shanghai pares earlier gains

TOKYO (March 1): Benchmark Tokyo rubber futures slipped on Thursday after Shanghai futures pared some of their earlier gains and as a firmer yen against the US dollar weighed on market sentiment.

The Tokyo Commodity Exchange (TOCOM) rubber contract for August delivery finished 1.3 yen lower at 192.5 yen (US$1.80) per kg, after rising earlier to 194.3 yen.

The most-active rubber contract on the Shanghai futures exchange for May delivery fell 70 yuan to finish at 13,010 yuan (US$2,051) per tonne, sliding from an intra-day high of 13,075 yuan.

The US dollar was quoted around 106.80 yen in late Thursday trade in Asia, compared with around 107.05 yen on Wednesday afternoon.

A stronger yen makes yen-denominated assets less affordable when purchased in other currencies.

“Although the TOCOM slightly declined today, I believe it is still on a recovery trend after hitting the recent low below the 180-yen mark in the middle of February,” said Satoru Yoshida, a commodity analyst with Rakuten Securities.

The front-month rubber contract on Singapore’s SICOM exchange for March delivery last traded at 148.1 US cents per kg, down 0.8 cent.

Crude rubber inventories at Japanese ports stood at 14,877 tonnes as of Feb. 20, down 0.5% from the last inventory date, data from the Rubber Trade Association of Japan showed on Thursday.

(US$1 = 106.8700 yen)
(US$1 = 6.3420 Chinese yuan)

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