TOKYO (Jan 23): Benchmark Tokyo rubber futures fell to a nearly 2-week low on Monday as supply concerns due to recent floods in Thailand eased, and following a plunge in Shanghai futures.
"Shanghai futures apparently took a beating after the estimated impact from Thai floods was downgraded," said Toshitaka Tazawa, analyst at Fujitomi Co.
Thailand, the world's biggest rubber producer, will lose around 7.6% of its rubber output in 2017 after flooding hit the main growing region, lower than the previous week's estimate of 10%, an official at the Rubber Authority of Thailand told Reuters on Friday.
The Tokyo Commodity Exchange (TOCOM) rubber contract for June delivery finished 2.0 yen, or 0.7%, lower at 286.3 yen (US$2.52) per kg. It touched the lowest since Jan 11 of 282.3 yen earlier in the session.
The most-active rubber contract on the Shanghai Futures Exchange for May delivery tumbled 605 yuan to finish at 19,845 yuan (US$2,896.02) per tonne.
"I expect to see more position adjustments this week ahead of the week-long Lunar New Year holiday in China," he added.
The Lunar New Year holiday starts Jan 27 in China.
The front-month rubber contract on Singapore's SICOM exchange for February delivery last traded at 209.8 US cents per kg, up 2.1 US cents.
(US$1 = 113.5100 yen)
(US$1 = 6.8525 Chinese yuan)