Tokyo rubber near one-week low

Tokyo rubber futures fell to a near one-week low on Tuesday due to technical selling as they struggled to stay above a key resistance level of 230.0 yen despite the strength of other commodities.
Investors sold after prices did not rise in line with other commodity futures, dealers said. The benchmark March 2007 contract was down 7.7 yen at 224.4 yen ($1.88) per kg.
"A technical correction plus some disappointed selling because rubber didn't go up despite the strength of other commodities led players to liquidate contracts," a Singapore-based trader said.
But traders said they expected the benchmark rubber contract could rebound in the afternoon, if further gains by other commodity futures buoyed sentiment for rubber.
"It could rebound if other commodities keep on going up," another dealer said. Spot gold rose to $578.00/579.00 an ounce from $576.00/577.10 an ounce in late trade in New York as Japanese speculators returned to the market on safe-haven buying after North Korea said it carried out an underground nuclear test.
In the physical market, the price of USS3, the raw material for export-grade Thai rubber sheet, was quoted unchanged at 62.0 baht ($1.65) per kg.
Thai RSS3 tyre-grade was around $1.88-1.90 per kg, in line with Malaysia's SMR20, which cost around $1.88 per kg. Thai 60 percent concentrated latex was quoted at $1,350 per tonne, free on board, for November shipment in drums while it cost around $1,250 in bulk.
Indonesia's SIR20 was steady at 83 US cents per pound. However, physical rubber prices were expected to rise over the next few days as more rains were threatening southern Thailand, its main growing area.
"Rains subsided for a few days, but more is expected to hit the south at the end of this week. That's why people are beginning to buy USS," a trader in Thailand's Hat Yai rubber hub said.
The Thai Meteorological Center said monsoon rains hovering over north and central Thailand were moving south and would bring heavy rains to around 60 percent of the south. Several depressions have crossed Thailand since early October, causing flash floods in the north and central regions and killing around 40 people.