Tokyo rubber futures bounced back on Monday, climbing almost 2 percent to a fresh 13-month high near 240 yen on tight domestic stocks and lower physical supplies. The key Tokyo Commodity Exchange rubber contract for April delivery was at 238.3 yen per kg at 0620 GMT, after earlier rising as high as 239.4 yen, up 4.2 yen, or 1.8 percent, the highest since October last year.
Futures had edged down on Friday, snapping a two-day rally. A Tokyo-based broker said domestic Japanese inventories were at a low level and that there was a sense of tightness because of this.
The most recent data by the Rubber Trade Association of Japan shows that Japan's crude rubber inventories totalled 4,195 tonnes as of October 20, the lowest in a year. He also said that tapping was disrupted in producing countries due to poor weather conditions. "We also can't ignore the strength in (other commodities), such as gold, which is hitting consecutive record highs," he said.
A Thai-based trader said Chinese players may be less active in the market due to the rise in physical rubber prices, which was tracking moves in the futures market. US crude oil rose above $77 a barrel, as a weaker dollar and improved sentiment over the economic outlook encouraged traders to push up crude prices. The dollar was slightly softer against the yen at 89.57 yen, but above this month's weakest point at 89.18 yen.