BANGKOK (Sept 11): Tokyo rubber futures slipped on Thursday as concerns over weak demand amid a supply glut in major producing countries continued to weigh on prices, encouraging investors to sell contracts to stop losses, dealers said.
The Tokyo Commodity Exchange rubber contract for February delivery slipped 0.7 yen to settle at 187.9 yen per kg.
The benchmark fell to a 5-year low of 187 yen per kg on Wednesday.
“Weak demand in China was a major concern that weighed on TOCOM prices,” said a Bangkok-based dealer.
Thailand, Indonesia and Malaysia account for more than 70 percent of global natural rubber output, but their International Rubber Consortium (IRCo) has foundered as the industry faces a shaky economic outlook in China, a fourth straight year of oversupply and stiff competition.
More than 10,000 farmers in Thailand, the world’s biggest rubber producer, are planning to stage protests demanding the government announce measures to support prices.
Dealers cited weaker oil prices as another negative factor that prevented TOCOM prices from rising.
Brent crude stayed above $98 a barrel on Thursday, amid geopolitical concerns in the Middle East, although worries about ample supply and weak demand that dragged prices to 17-month lows in the previous session kept a lid on gains.
The most-active rubber contract on the Shanghai futures exchange for January delivery fell 95 yuan to finish at 13,410 yuan per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for October delivery last traded at 148.60 U.S. cents per kg, down 2.3 cents.
– Reuters
