Tokyo rubber edges higher

Print this page Posted on : 03-28-2008 by recycleinme.com

Tokyo rubber futures rose modestly on Thursday due to firm oil prices, but the gains were limited by a strong yen.The benchmark rubber contract on the Tokyo Commodity Exchange for September delivery rose 1.7 yen, or 0.6 per cent, to 285.7 yen ($2.87) per kg. Rubber prices often benefit from higher crude oil prices as such a rise is expected to encourage a shift to natural rubber from synthetic rubber, a petroleum product.

Expectations of strong physical rubber demand from China, the world's largest natural rubber consumer, were also lending support to the Tokyo market, traders said. In China, irregular weather has forced plantations in the south to postpone tapping and reduced rubber stocks. In Thailand, the biggest producer, and Malaysia, the third biggest, farmers have stopped tapping during the dry season, when trees stop producing latex. They should resume tapping in late April.

Physical rubber prices were higher. Trade was likely to be busier with most European tyremakers back from holidays while Chinese and Japanese buyers were expected to replenish falling stocks, traders said.

Source : Business Line