S'pore rubber futures up as China's demand rises
S'pore rubber futures up as China's demand rises
SINGAPORE (Reuter): Singapore rubber futures closed higher
yesterday, but off the day's peaks at the close with some
Japanese brokerages saying that sentiment was being helped by
talk of fresh Chinese buying enquiries, brokers said.
"The market is higher because of China inquiring heavily for
Thai and Indonesian rubber yesterday and today," a trader at a
Japanese brokerage said. But some dealers in Singapore said they
were not aware of such rumors.
The Japanese house's trader said China was buying Indonesian
Nov/Dec SIR20 rubber FOB Padang at 64 U.S. cents a lb. "I heard
2,000 tons of rubber was traded and a further deal of 2,000 tons
is going on."
But a Singapore dealer said: "Padang was traded at 62.50 cents
yesterday and I doubt the Chinese are willing to pay 64 cents."
The Japanese brokerage trader said he also heard Chinese
buyers were seeking to buy 5,000 tons Thai Dec RSS3 although he
said other sources put the number at 10,000 tons.
Thai RSS3 offers were seen at 151 U.S. cents a kg this morning
and traders said sellers turned scarce in the afternoon after
sharp gains on the Singapore futures. China last entered the
market two weeks ago, buying Thai rubber at about 140 cents.
In Kuala Lumpur fresh buying interest and shortcovering by
China, coupled with a steady Tokyo market, pushed up rubber
prices, dealers said.
"The market is firming on reports of fresh buying and
shortcovering activities by China," one trader said.
"They are aggressively looking to buy SMR 20 for Nov/Dec
shipment." Some quantities have been traded but dealers could not
give more details as none of it was tendered.
Chinese buyers returned to the market yesterday, after staying
away in recent days, making fresh purchases to replenish its
stocks, traders said.
Some dealers said that China bought more than 20,000 tons of
rubber in Thailand, Indonesia and Malaysia for October/November
shipment last month.
A steady Tokyo market rose on a weaker yen versus the U.S.
dollar. European buyers were seen covering their positions for
SMR CV, SMR L and SMR10 for nearby shipment.
"The wet weather is still a bullish factor and rains keep
falling in major rubber growing areas in Malaysia," one dealer
said, estimating falls of up to 45 percent in September/October
output. Dec RSS 1 buyer rose a cent to 377.50 cents ($1.48) a kg
and Dec SMR 20 buyer was up 3.50 cents at 362.50 cents.