Benchmark Tokyo rubber futures erased early gains to end slightly lower on Tuesday, weighed down by stock overhang in Japan that heightened worries over slack global demand. Tokyo Commodity Exchange (TOCOM) futures, which set the tone for rubber prices in Southeast Asia, have been trading below 200 yen per kg since late January, reflecting weak fundamentals.
Crude rubber inventories at Japanese ports stood at almost 15,000 tonnes last month, near the highest level since August 2014, industry data showed. That reflected surging imports from Asia's major producers including Thailand supported by a stronger yen, which makes Japanese imports of goods cheaper, industry sources said.
"Excess supplies are building up domestically," which are pressuring TOCOM prices, said a Japanese broker. The Tokyo Commodity Exchange rubber contract for August delivery finished 0.4 yen lower at 192.3 yen ($1.80) per kg. The most-active rubber contract on the Shanghai futures exchange for May delivery rose 5 yuan to finish at 12,695 yuan ($2,005) per tonne. The front-month rubber contract on Singapore's SICOM exchange for April delivery last traded at 145.6 US cents per kg, down 0.8 cent.
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