* TOCOM rubber sees resistance at 205 yen/kg
* Thai crisis undermines rubber market
By Lewa Pardomuan
SINGAPORE, May 12 (Reuters) – Tokyo rubber futures couldtrack oil prices higher this week, but gains would be curbed byconcerns over demand, Thailand’s plan to sell from itsstockpiles, and a lack of action from main producers to supportprices, dealers said on Monday.
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The most active rubber contract on the Tokyo CommodityExchange has plunged more than 25 percent this year onfears of slower economic growth in top consumer China. TheOctober contract rebounded on Monday as oil rose on tensions inUkraine but it faces tough resistance at 205 yen a kg. ]
Indonesia has suggested that Vietnam, Cambodia and Laosjoin a regional grouping in an effort to rescue prices after aprotracted crisis in Thailand has made it impossible for membersto take action.
Thailand, Indonesia and Malaysia are grouped in theInternational Rubber Consortium (IRCo), which last intervened tosupport prices in 2012-2013.
“Vietnam and Laos are also producing TSR, but theirproduction cost is much lower. I think they want to sell theirrubber,” said Gu Jiong, an analyst at Yutaka Shoji Co in Tokyo.
“So even at current prices, I think they will sell. If theyare invited to join the group, they would vote not to supportprices. I think it’s not a good idea to invite them.”
SICOM’s TSR20 contract – which covers Thai,Indonesian and Malaysian grades – firmed on Monday as Tokyoregained strength, but the prices were still within sight oftheir weakest level since mid-2009.
Thailand’s beleaguered government has warned people to stayaway from anti-government protests, saying it had to step upsecurity as the two sides in a lengthy political crisis squaredoff over who is running the country.
– Reuters
