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BANGKOK, June 27 (Reuters) – Tokyo rubber futures tumbled to 3-1/2 month low on Monday, weighed by rising supply in major producing countries and concerns about Europe’s debt, which has triggered a broad sell-off in commodities, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> for December delivery fell 8 yen, or 2.3 percent, from the opening prices to settle at 345.0 yen ($4.289) per kg.
It fell as low as 344.0 yen, the lowest since mid-March.
The front-month June contract expired on Friday and deliveries against the June rubber futures contract fell 39 percent from May to 146 lots or 730 tonnes.
The most-active Shanghai rubber contract for September delivery fell 1,425 yuan to finish at 30,725 yuan ($4,745.169)per tonne.
“Rubber could fall gradually due to rising supply in Thailand, but we have another big negative factor of Europe debt concerns that dragged TOCOM prices down deeper than expected,” one dealer said.
Greece’s parliament begins on Monday to debate a deeply unpopular austerity plan which international lenders are demanding to see approved this week to avert the threat of bankruptcy.
Rubber supply in Thailand, the world’s biggest rubber producer and exporter, was expected to rise further in July as rains stopped and allowed farmers to tap more latex, said a trader in Thailand’s southern Hat Yai rubber centre.
However, traders said they expected TOCOM prices to rebound on Tuesday, expecting prices to find a strong support level at around 340 yen, while demand on the physical front should lend support.
($1 = 80.430 Japanese Yen)
($1 = 6.475 Chinese Renminbi)
Source: Reuters