* China buys Thai STR20 at $2.39 and $2.41/kg CIF
* Bridgestone chases Indonesian grade, prices vary
* Market shrugs off China’s stockpile programme
By Lewa Pardomuan
SINGAPORE, Dec 18 (Reuters) – Main consumer China bought Thai rubber, Bridgestone Corp bought a few cargoes of Indonesian grade, and the recent gains in benchmark Tokyofutures underpinned sentiment in the physical market, dealers said on Wednesday.
The most active rubber contract on Tokyo Commodity Exchange has bounced more than 20 percent due to a weaker yen, having fallen to a nine-month low of 225 yen a kg in June. But TOCOM has discounted purchases by China’s state reserves.
Thai STR20 grade for January/February delivery was sold to Chinese buyers at $2.39 and $2.41 a kg including freight, in a series of overnight deals. Last week, the grade was indicated at $2.45 CIF with no reports of trades.
Another Thai grade, RSS3, fetched much higher prices, traded at $2.595 a kg for February, without freight, versus $2.55 and $2.56 last week.
“China is stockpiling, but they are only buying domestic rubber and the RSS grade. I think that is why it doesn’t have much impact on the physical market,” said a dealer in Singapore.
The State Reserve Bureau purchased 45,900 tonnes of Standard China Rubber (SCR) at a price of 19,700-23,000 yuan ($3,800) per tonne and 41,300 tonnes of Thai RSS rubber at 20,800-21,800 yuan per tonne, Dongwu Futures said in a report.
Dealers said the purchases may stir up the physical market if they also include the widely traded STR, SMR and SIR grades.
The current round of stockpile by China’s state reserves brings the total volume of purchases in the second half of the year to about 230,000 tonnes.
Indonesia’s SIR20 was sold to Bridgestone, the world’s largest tyre maker, on Monday at 106.00 U.S. cents a pound ($2.38 a kg) FOB for January and at 106.25 cents for February.
Late on Tuesday, SIR20 for February was traded to the tyre maker at 105 to 105.50 cents a kg, within sight of last week’s levels of 105.50 to 105.75 U.S. cents.
Malaysia’s SMR20 changed hands at $2.43 to $2.44 a kg, higher than last week’s offer prices of $2.42 kg.
WEEK AHEAD
Tokyo rubber futures could set the tone for physical market next week, with the Indonesian grade getting additional support from limited supply in some areas in the main growing island of Sumatra.
“Supply is tight in northern Sumatra because of heavy rains. There’s not much raw material coming out,” said a dealer in Sumatra.
Source: Reuters
