Tokyo rubber falls on demand worries
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Tokyo rubber futures tumbled to the lowest level since September 2005 on Wednesday on fears of weaker demand caused by economic recession. Falls on stock markets and weaker oil prices added to the pressure on rubber prices.
The benchmark rubber contract on the Tokyo Commodity Exchange for March delivery fell ¥15, or 7.8 per cent, to settle at ¥178 ($1.76) per kg. At one stage it fell by the ¥16 daily limit to ¥177.1, the lowest since September 2005. On Tuesday, the March contract briefly rose above the psychologically key level of ¥200, mainly on short-covering, but failed to stay above that level, a factor worsening the technical chart outlook.
Dealers said they expected TOCOM prices to fall further with 185 yen was seen as a strong resistance. In the physical market, rubber prices fell further, with Thai traders keen to sell despite thin demand. Physical trade remained under pressure that Chinese buyers have defaulted on more than 10,000 tonnes of rubber from Thailand, Indonesia and Malaysia after prices fell more than 30 per cent.
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Source : Business Line |
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