Asian physical rubber prices were mostly firmer on Monday, supported by recovery in futures prices on the Tokyo Commodity Exchange. Physical supply is expected to increase this week due to improving weather in Thailand, the world's biggest rubber producer, said a trader in the country's Hat Yai rubber hub.
Rain has stopped, paving the way for resumption of tapping and transportation. But whether buyers such as China enter the physical market will depend on volatility in the TOCOM market, traders said.
Fund selling had sent the key TOCOM contract down by more than 10 percent last week. "Physical trade would pick up the pace if production is out in the market, as expected. That depends on the TOCOM market," said a trader at a Japanese trading firm. "If volatility is back, I guess they'd rather wait-and-see."
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