Asian rubber settled higher for the fourth successive trading day Wednesday and rose above Y290 a kilogram for the first time in 15 months amid strong speculative buying, said trade participants.
Physical prices of the Thai USS3 raw material were above THB88/kg as total arrivals in the three central markets were below 100 metric tons for the third straight day. They are usually above 200 tons this time of the year.
The benchmark June RSS3 contract on the Tokyo Commodity Exchange settled Y4.1 higher at Y290.3/kg after reaching an intraday high of Y291.4, a level not seen since late September 2008.
Prices were steady during the night session, with the June contract ending at Y291.1. Night session prices aren't included in intraday trading.
"The general perception is that rubber prices will rise to Y300/kg in the near term. This psychological factor is pushing up prices," said a Tokyo-based trading executive.
He said fundamentals are also strong and the rise in car sales in China is supportive of demand for tires and rubber.
Overnight gains in crude oil, which rose for ninth successive trading day Tuesday, is positive for rubber futures, traders said.
They said crude oil is hovering around $82 a barrel, its highest intraday level in 2009, due to strong winter demand for heating oil.
Institutional funds are expanding their portfolio of longs, betting on Y300/kg being reached sooner than later, when they can opt for profit-taking, said an exporter in Singapore.
The benchmark May contract on the Shanghai Futures Exchange settled 0.8% higher at CNY24,925/ton.
The benchmark August contract on the Agricultural Futures Exchange of Thailand settled THB0.75 higher at THB102.25/kg.
Asian physical rubber prices were higher and Thailand's RSS3 grade was offered above $3,000/ton, tracking gains in rubber futures and limited supply from Malaysia.
"There is no doubt that futures are the main driver of rubber prices and the physical market is tagging along," said an exporter in Singapore.
Demand for Indonesia's SIR20 was strong in China, traders said.
(Source: irco.biz)
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