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BANGKOK, April 7 (Reuters) – Tokyo rubber futures hit a
20-month high on Wednesday on the back of strong oil prices and
tight physical supply but profit-taking capped the gains, dealers
said.
* The benchmark rubber contract on the Tokyo Commodity
Exchange <0#JRU:> for September delivery rose 3.0 yen to settle
at 326.8 yen ($3.48) per kg. It rose as high as 330.3 yen, the
highest since August 2008, before investors started taking
profits.
* Oil was steady on Wednesday, trading near 18-month highs
around $87 after a larger-than-expected drop in U.S. gasoline
stockpiles signalled fuel demand was rebounding. [O/R]
* Higher oil prices make alternative synthetic rubber
expensive and usually encourage tyre makers to shift to natural
rubber.
* “The key reason that supported TOCOM rubber prices was
tight supply while firmness in oil prices provided additional
support,” one dealers said.
* Physical rubber prices were quoted at a record high, with
the benchmark Thai RSS3 offered at $3.65 per kg due to a fall in
supply as rubber trees stop producing latex in the dry season.
* Thai, Indonesian and Malaysian rubber grades have been
trading at record prices well above $3 per kg as tyre makers
scramble to buy the commodity because of tight supply.
[ID:nSGE63508Q]
($1=93.80 Yen)
Source: Reuters