BANGKOK: Tokyo rubber futures crept higher on Tuesday on the back of firmer oil prices, but the upside was capped by profit-taking after a recent price jump to one-week highs, dealers said.
The benchmark rubber contract on the Tokyo Commodity Exchange for May delivery rose 2.6 yen to settle at 271.6 yen ($3.48) per kg.
Dealers said TOCOM prices could rise further on Wednesday after prices finished above a major resistance of 270 yen. However, TOCOM prices were unlikely to rise significantly as profit-taking could cap gains after recent rises.
The most active rubber contract on the Shanghai futures exchange for May delivery was up 75 yuan to finish at 25,160 yuan ($3,900) per tonne.
"The market was supported by firmer oil prices but there was profit-taking after recent rises that limited TOCOM's gains," said a Bangkok-based trader.
Brent crude rose above $109 on Tuesday as supply worries triggered by concern over sanctions against Iran and Syria checked initial losses, while investors kept a watch on developments in Europe for further trading cues.
TOCOM prices got some support from seasonal falling supply in Thailand's south, the country's major rubber area, which has been hit by monsoon rain that has disrupted tapping and cut supply, dealers said.
Global natural rubber output could rise 3.6 percent to 10.388 million tonnes in 2012, but growth is expected to be slower than this year as falling prices affect yield, according to the Association of Natural Rubber Producing Countries (ANRPC).
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