Tokyo futures up on Thai import plan; Europe caps gains

Wednesday, 23 May 2012 00:13 - - {{hitsCtrl.values.hits}}

BANGKOK (Reuters): Tokyo rubber futures rose above 280 yen on Tuesday, extending gains into a second straight session as news that Thailand would import rubber from the TOCOM exchange continued to buoy prices.

But gains were limited as investors were still cautious about how much Thailand could buy, while European debt woes also pressured prices, they said.

The benchmark rubber contract on the Tokyo Commodity Exchange for October delivery inched 1.7 yen higher to settle at 280.4 yen ($3.53) per kg.

The most-active rubber contract on Shanghai rubber futures exchange for September delivery fell 125 yuan to finish at 24,610 yuan ($3,900) per tonne.

The front-month June contract on Singapore’s SICOM exchange was last traded at 336.50 U.S. cents per kg, up 1.2 cents.

“The news about Thailand’s plan to buy rubber from TOCOM lent support to prices. But it is still not clear how many tonnes of rubber it could buy and would it be big enough to push up prices,” a Tokyo-based dealer said.

Thailand, the world’s biggest rubber producer and exporter, said on Monday it would import rubber to honour overseas contracts after rain reduced supplies. Traders said they were still monitoring Thailand’s move on importing rubber to see if it could push TOCOM prices to sustainable firm prices.

Dealers said they expected TOCOM prices to move in a tight range over the next few days as mounting concerns about a euro zone debt crisis still weighed on the market.

European Union leaders may introduce new measures to tackle the euro zone’s worsening debt crisis during an informal meeting on Wednesday to seek solutions to the Greek political turmoil, mired in conflict over debt and austerity policies.