Tokyo rubber up by 16 yen limit, ends over 185 yen

TOKYO, Oct 20 (Reuters) - Key Tokyo rubber futures rose by the 16 yen daily limit on Monday as bargain hunting and strong oil prices spurred buying, recovering a fraction of the sharp drop since early September.

   * The key Tokyo Commodity Exchange rubber contract for March delivery <0#JRU:> closed at 185.2 yen per kg, up 9.5 percent.

   * The benchmark contract has dropped about 40 percent since early September, hurt by the economic downtrend which has eroded automobile sales, and hit a trough of 159.3 yen on Friday, the

lowest since July 2005.

   * NYMEX crude for November delivery <CLc1> extended gains to top $73 a barrel, boosted by expectations OPEC could cut output at an emergency meeting this week to shore up prices.

   * A Tokyo-based broker said he saw Monday's rubber rally as a technical bounce after a round of selling had spent itself out.

   * "I don't see this as the start of a market recovery ... but for the time being rubber prices could head towards 180-200 yen," he said.

   * He said that rubber was a commodity directly affected by the current poor state of the economy.

   * The economic growth rate of China, the world's top rubber consumer, slipped into single digits in the third quarter, dragged down by the global credit crisis and a weak property sector.

   * China's annual GDP growth fell to 9.0 percent in the third quarter from 10.1 percent in the second quarter, while the pace of factory output in September dropped to a six-year low, the government said on Monday.

   * Last week, dealers said Chinese buyers have defaulted on more than 10,000 tonnes of rubber from Southeast Asia after prices lost more than 30 percent in the past month.

   PRICES OF ASIAN PHYSICAL RUBBER COMPARED WITH FRIDAY

   Grade                                Price         Change

   Thai RSS3 (Nov)                     $1.75/kg       +$0.15

   Thai RSS3 (Dec)                     $1.75/kg       +$0.15

   Thai STR20 (Nov)                    $1.75/kg       +$0.15

   Thai STR20 (Dec)                    $1.75/kg       +$0.15

   Malaysia SMR20 (Nov)                $1.75/kg       +$0.05

   Malaysia SMR20 (Dec)                $1.75/kg       +$0.05

   Indonesia SIR20 (Nov)               $0.75/lb       +$0.05

   Indonesia SIR20 (Dec)               $0.75/lb       +$0.05

   Thai USS3                           50 baht/kg     +5 bahts

   Thai 60-percent latex (drums, Nov)  $1,350/tonne   +$250

   Thai 60-percent latex (bulk, Nov)   $1,200/tonne   +$100

** NOTE - The prices quoted above are offer prices collected from traders in Thailand, Indonesia and Malaysia. They are not official prices quoted by state-run rubber agencies in those countries.

Source : Thomson Reuters