* TOCOM rubber in range of 253 to 272 yen, awaits U.S. payrolls data
* Sugar market awaits Thai tender on Nov. 6
* Coffee premiums could strengthen on London weakness
By Lewa Pardomuan
SINGAPORE, Nov 4 (Reuters) – Tokyo rubber futures may trade in a wide range this week ahead of the release of important U.S. data that could influence the timing of the Federal Reserve’s plan to reduce stimulus, dealers said on Monday.
Among other soft commodities, Thai raw sugar premiums are likely to move in familiar ranges, coffee premiums in Vietnam and Indonesia may rise if London futures extend losses, but cocoa butter ratios may soften below last week’s 2.70 times London futures as prompt demand wanes.
The most active April rubber futures on Tokyo Commodity Exchange were untraded on Monday, a holiday in Japan. They had ended Friday at a one-week low of 259.8 yen a kg, down 1.8 yen.
“The market will be highly volatile ahead of the release of any economic data, looking for clues when the Fed will taper the monetary stimulus. We are waiting for the non-farm data on Friday and it could be lower than expected,” said Vanessa Tan, an investment analyst at Phillip Futures in Singapore.
“The Fed may maintain the stimulus until next year, which will devalue the dollar and cause the yen to strengthen. That will weigh on TOCOM rubber. I am looking at resistance at 272 yen this week and support at 253 yen.”
Although TOCOM rubber sets the tone for tyre grade prices in main producers Thailand, Indonesia and Malaysia, the contracts are often influenced by macroeconomics, currencies, equities and even the price of crude oil.
Friday’s U.S. payrolls report is expected to show a modest rise of just 125,000 in October. A soft report, and particularly any rise in the jobless rate, would argue against the Fed tapering in December.
In the sugar market, dealers await the result of a Thai tender on Nov. 6 for clues on demand for the crop, the crushing of which starts this month. State-run Thai Cane and Sugar Corp (TCSC) will sell 60,666 tonnes of raw sugar from the 2013/14 crop for March-May and May-July shipments.
Coffee premiums could edge up to offset declines in London, where the January contract tumbled on Friday to its lowest in more than three years at $1,453, squeezed by Vietnam’s huge harvest.
Dealers shrugged off Vietnam’s plans to take 300,000 tonnes of coffee beans out of the domestic market to shore up prices that hit a three-year low.
“The failure of previous retention schemes from other producers during low coffee price cycles suggests this scheme will also fail,” said Herve Touraine, a trader at brokerage house SW Commodities.
“The eventual stockpiling budget, based on today’s local prices, should be close to $440 million with potential additional expenses, depending on how long the coffee remains unsold.” (Editing by Clarence Fernandez)
Source: Reuters
