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TOKYO, Jan 22 (Reuters) – Benchmark Tokyo rubber futures rose to a 1-week high on Thursday, helped by an overnight rise in oil prices, technical rebound buying, and gains in the Shanghai market, dealers said.
Tokyo Commodity Exchange (TOCOM) futures, which set the tone for tyre rubber prices in Southeast Asia, have been weighed down by worries about oversupply and weakening demand in China, the world’s biggest buyer.
The TOCOM rubber contract for June delivery finished 5.5 yen higher at 201.4 yen ($2) per kg, the highest since Jan 14.
“The market got a lift after an increase in offer prices by producers in Thailand. I think the gain was more to do with a technical rebound as there was no new fundamental news,” said Toshitaka Tazawa, an analyst at Fujitomi Co.
Thailand, Malaysia, Vietnam and several other rubber-producing countries will see the onset of the wintering season, when trees shed leaves, from February through April. In
Indonesia, wintering lasts from February to May before starting again in July to continue through September.
“There are hopes that supply will tighten after the wintering season. But I expect rubber prices to remain under pressure as there are still a lot of inventories,” Tazawa said.
The most-active rubber contract on the Shanghai futures exchange for May delivery rose 420 yuan to finish at 13,215 yuan ($2,129) per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for February delivery last traded at 139.90 U.S. cents per kg, up 1.10 cent.
($1 = 6.2085 Chinese yuan renminbi)
($1 = 117.7800 yen)
(Reporting by Yuka Obayashi; Editing by Anupama Dwivedi)
