TOKYO: Benchmark Tokyo rubber futures snapped three days of gains to head lower on Tuesday, pulling back from a 10-month high, as investors took profit ahead of the week-long Lunar New Year holiday in China that starts on Wednesday.
The Tokyo Commodity Exchange (TOCOM) rubber contract for July delivery finished at 218.4 yen ($2) per kg, down 1.5 percent, or 3.3 yen.
"Investors took profit on concerns that the benchmark may fall sharply after the Lunar New Year holiday as had happened before," said Toshitaka Tazawa, analyst at Fujitomi Co.
"Behind the weak market was also wariness over rubber prices' steep rise over the past few sessions," he added.
TOCOM futures, which set the tone for tyre rubber prices in Southeast Asia, have gained more than 10 percent this month amid shorter supply of raw material in Indonesia and expectations of tightness elsewhere due to wintering, a period when rubber trees become drier.
Higher stocks also added to the selling pressure.
Crude rubber inventories at Japanese ports stood at 13,226 tonnes as of January 31, up 1.9 percent from 10 days earlier, data from the Rubber Trade Association of Japan showed on Tuesday.
The most-active rubber contract on the Shanghai futures exchange for May delivery fell 150 yuan to finish at 13,875 yuan ($2,218) per tonne.
Chinese markets will be shut for a week from Wednesday for the break.
The front-month rubber contract on Singapore's SICOM exchange for March delivery last traded at 143.8 US cents per kg, up 0.4 cent. SICOM will close early on Wednesday and remain closed on Thursday and Friday.
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