Tocom Rubber Prices Rise 2 Percent on December 9, Boosted by Weaker Yen and Rise in Oil

The Japanese yen currency weakened. The USDJPY currency pair traded 0.3 percent stronger at 114.40.

The weakening of the yen raised the price of Tocom natural rubber futures. For foreign buyers, the weakening of the yen exchange rate made commodity prices traded in the currency relatively less expensive so that demand increased.

Tocom rubber prices were also supported by the increase in crude oil prices in Asian trading sessions.  

Crude oil prices extended their increase on Friday (December 09) during the Asian session, supported by increasing optimism that non-OPEC producers agreed to cut production following the OPEC group's agreement to limit production.

US crude oil futures for January delivery increased by 16 cents or 0.31 percent to $51.00 per barrel.

Brent crude oil for February delivery remained stable at $53.89 per barrel.

See: Crude Oil Prices During Asian Session Increase Reaching $51

The increase in crude oil prices made the cost of synthetic rubber production more expensive. As a result, demand for natural rubber commodities such as those traded on Tocom increased quite significantly.

The price of natural rubber on Tocom for the most active contract, which is the May 2017 contract, ended at a jump of 5.0 yen or 2.1 percent this afternoon at 245.40 yen per kilogram, up compared to the previous closing position of 240.40 yen per kilogram.

Vibiz Research Center analysts predict that the movement of Tocom rubber prices in subsequent trading today still has the potential to increase with the weakening of the yen and the increase in crude oil prices.

For the subsequent trading session, it is predicted that prices will encounter a resistance level at 250.00 yen. The next resistance is at 255.00 yen. Meanwhile, if prices weaken, they will encounter support at 240.00 yen and 235.00 yen.