Asia Rubber Futures Settle Mostly Up As Crude, Metals Support

    SINGAPORE (Dow Jones)--Asian rubber futures settled mostly higher Tuesday, helped primarily by rebounds in crude oil and metals futures, while Japan's markets were given a further boost by gains in the value of the dollar against the yen. 

    On Tocom, rubber futures rebounded from this morning's decline to settle higher, helped by reports of upcoming production cuts by major producing countries, a weaker yen against the dollar and gains in crude prices, said a trader in Tokyo. 

    However, the potential for further volatility remains in coming days amid continued wider financial market turbulence, he added. 

    Tocom's new benchmark April RSS3 contract settled Y6.8 higher, at Y166.5 a kilogram. 

    On C-Com, rubber futures also rebounded to settle mostly higher, again supported by firmer crude oil prices and the weaker yen, said a trader in Japan. 

    However, weak spot markets and lingering concerns about slowing global demand will likely cap the upside in coming sessions, he said. 

    On the Shanghai Futures Exchange, rubber futures settled mostly higher as futures prices' decline to below production costs prompted short covering amid signals that a bottom is near, said Lin Hui, an analyst at Orient Futures Securities. 

    "CNY12,000 should be able to offer strong support in the short term, both technically and fundamentally," Lin said, adding, however, that SHFE rubber will find any rebound to be limited and short-lived as global financial markets may only be starting to stabilize. 

    On Sicom, all traded rubber contracts settled lower, in line with declines in other exchanges yesterday, when Sicom was closed for a public holiday in Singapore. 

    RSS3 futures on the Agricultural Futures Exchange of Thailand settled mostly higher, in line with the rebound on the bellwether Tocom and SHFE markets, with the rebound in crude oil prices also helping to lift sentiment, said a trader in Bangkok. 

    Asian cash rubber prices were weaker, despite the rebound on Tocom, with buying interest muted amid expectations today's rally may prove short-lived. 

    Meanwhile recent volatility also damped interest, traders said. 

    The focus is now on tomorrow's meeting of the International Rubber Consortium on what measures the group - which represents the world's top three producing countries, Thailand, Indonesia and Malaysia - may take to limit output, said a trader in Phuket. 

    "Any indications that the market may stage a rebound from current levels would likely spark strong renewed buying interest," he said. 

Asian Rubber Futures 

                      Oct 28               Change from 

                                           Oct 27 Close 

Tocom    Apr  RSS3    Y166.5/kg            Up Y6.8* 

C-Com    Apr  RSS3    Y168.9/kg            Up Y5.9* 

Shanghai Jan  SCR5    CNY12,860/ton        Up CNY105 

Thai     May  RSS3    THB61.75/kg          Up THB0.85 

Sicom    Nov  RSS3    Untraded             - 

Sicom    Nov  TSR20   168 U.S cents/kg     Dn 4.50 cents/kg** 

*Note: The new April benchmark contracts on Tocom and C-Com began today, so previous settlement price refers to this morning's opening price **Note: Sicom was closed Monday for a public holiday in Singapore, so the previous close refers to Friday's close; Sicom rubber futures prices refer to the closing prices of the day, as the settlement prices aren't available. 

The following are Tuesday's physical prices in Asia, quoted in U.S. cents a kilogram, FOB basis: 

Grade  Shipment  Oct 28                  Oct 27 

                 Bids     Offers         Bids     Offers 

RSS3   Nov       -        180-183        -        185 

STR20  Nov       -        177-180        -        183-185 

SIR20  Nov       -        167.5          -        178.5 

SMR20  Nov       -        177.5-180      -        183-185 

USS3   Oct                THB56.86/kg           THB57.74/kg 

Source : Dow Jones