Benchmark Tokyo rubber futures on Tuesday extended declines to hit a two-month low, as the market came under pressure from a strong yen against the dollar and weak Shanghai prices, brokers said. Against the yen, the dollar eased 0.2 percent to 108.78 yen, edging back in the direction of a 4-1/2-month low of 108.28 yen set on Friday.
A stronger Japanese currency makes yen-denominated assets less affordable when purchased in other currencies. The Tokyo Commodity Exchange rubber contract for July delivery finished 2.6 yen lower at 195.5 yen ($1.80) per kg, the lowest settlement since November 22.
The most-active rubber contract on the Shanghai futures exchange for May delivery fell 415 yuan to finish at 13,395 yuan ($2,115) per tonne. Vietnam, the world's third-biggest natural rubber producer, is estimated to export 150,000 tonnes of rubber this month, up about 61 percent from a year ago, the government said on Monday. The front-month rubber contract on Singapore's SICOM exchange for February delivery last traded at 149 US cents per kg, down 2.8 cents.
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