Key Tokyo rubber futures hit a record high on Monday to reverse earlier losses, helped by back of firm Shanghai rubber futures and strong demand at a time when supply is limited, dealers said. The key Tokyo Commodity Exchange rubber contract for June delivery rose to a record 419.3 yen per kg before settling at 417.6 yen, up 1 yen or 0.2 percent.
The contract fell as much as 7.7 yen or 1.8 percent to 408.9 yen in early trade, when other commodities markets were hit by the rate rise announced by China's central bank on Saturday.
Traders said the fall offered bargain-hunting opportunities for investors. The most active Shanghai May rubber futures contract closed at 37,110 yuan per tonne on Monday, down 190 yuan from Friday's close. Volume stood at 858,082 lots, down from Friday's 998,258 lots. Asian physical rubber prices were offered higher on Monday, supported by rising TOCOM futures prices and limited supply.
Spot silver, platinum and palladium reversed earlier losses on bargain-hunting after earlier falling about 1 percent on China's rate increase. The tight natural rubber supply situation in the world market "is likely to be aggravated further" in February-May 2011, the group responsible for 92 percent of global output said, as it is seasonally the lean period for tapping.
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