Tocom Rubber Falls On Thai Decision; Y215-Y220 Downside Target (Aug 28)

Tocom rubber futures settle lower, extending losses in the last half hour of trade after market participants were disappointed that the Thai government didn’t allocate additional funding to its price-intervention plan. Absent a positive catalyst, Tocom prices may fall further to Y215-Y220/kg, after rebounding by around 10% from near a three-year low in the past two weeks, a Bangkok-based trader says.

The Thai Cabinet agreed to continue with the government’s price-intervention plan, Thai Deputy Agriculture and Cooperatives Minister Nattawut Saikuar said earlier in the day; he didn’t mention additional funding. Some market participants had expected the Cabinet to double the total allocation to THB30 billion. The previous benchmark contract, January, settles Y3.6 lower at Y225/kg; the new benchmark February contract opened at Y230/kg and settles at Y226.1/kg.

Source: Dow Jones