* TOCOM rubber could resume decline after holiday
* Tokyo rubber support seen at 195 yen/kg
By Lewa Pardomuan
SINGAPORE, May 5 (Reuters) – Thailand’s plan to sell rubberfrom the state inventory could spur further declines in Tokyofutures, dealers said on Monday.
Among other soft commodities, cheaper Vietnamese robustasare in favour among foreign roasters, while cocoa butter ratioscould weaken if demand from chocolate makers fails to improveafter the Easter celebrations.
Top rubber producer Thailand had planned in April to sellmore than 200,000 tonnes of rubber it had bought from farmers.No sales were made last month, but caretaker AgricultureMinister Yukol Limlaemthong told Thai media last week thecommodity would be released soon to avoid further losses.
“We are going to see more supply in the export market. Thatwill pressure prices. The market hasn’t reacted to the winteringseason and the Thai government is still going to release moresupply. This will be pretty bearish,” said Vanessa Tan, aninvestment analyst at Phillip Futures in Singapore.
“There’s a possibility of El Nino but I haven’t seen supportfrom that. It’s not confirmed yet,” said Tan, who pegged supportat 195 yen a kg and resistance at 215 yen.
El Nino is marked by a warming of the sea’s surface on thePacific Ocean and could lead to severe drought in Australia,South East Asia and India.
The most active rubber contract on Tokyo Commodity Exchange,currently October has fallen more than 20 percent thisyear on concerns over economic growth in main rubber consumerChina.
The Tokyo market is closed on Monday and Tuesday for anational holiday and prices could fall when trading resumes onWednesday.
On Singapore’s SICOM exchange, the TSR20 contract -which covers Thai, Indonesian and Malaysian grades – prices heldnear their weakest since mid-2009. Tight supply during the drywintering season has done little to support prices.
– Reuters
