* TOCOM rubber likely in 200 to 209 yen/kg range
SINGAPORE, May 19 (Reuters) – Global benchmark Tokyo rubberfutures would be trapped in a tight range this week as a drop ininventory in the Shanghai market fails to shake off worriesabout demand from main consumer China, dealers said on Monday.
The most active rubber contract on Tokyo Commodity Exchange,currently October, rallied more than 4 percent to a highof 208.4 yen a kg after Shanghai futures jumped almostfive percent due to a drop in inventory.
But the Tokyo market, which sets the tone for tyre gradeprices in Southeast Asia, has slipped about 25 percent this yearon concerns over economic growth in China. The October contractwas likely to trade in a range of 200 to 209 yen a kg this week.
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“Maybe the price will still be supported at 200 yen. Whenthe price gets over 209 yen, it may touch 220. But, it stillneeds strong news, such as bad weather,” said Gu Jiong, ananalyst at Yutaka Shoji Co in Tokyo.
“Without that, it will be kept in a narrow range. AlthoughShanghai (inventory) is falling, there’s still plenty of stocksin Qingdao,” said Gu, referring to the bonded warehouses.
Inventories in warehouse monitored by the Shanghai FuturesExchange have slipped to their weakest since December to 163,097 tonnes (SNR-TOTAL-DW), but stocks in Qingdao are estimated to have increased to around 362,000 tonnes from around360,000 tonnes last week and 290,000 tonnes in January.
Rubber in Qingdao was sold at discounts of more than 10cents to prices in Southeast Asia.
– Reuters
