TOCOM ends down 2.1% tracking Shanghai futures

Benchmark Tokyo rubber futures ended down 2.1% on Friday, tracking declines in Shanghai futures during the three-day Golden Week holiday in Japan and as gains in the yen against the dollar weighed on sentiment, industry sources said.

Chinese commodity futures from coal to eggs extended falls on Friday as speculators pulled more money out of markets whose sharp surge two weeks ago unnerved global investors and forced regulators to step in and restore calm.

Tokyo Commodity Exchange (TOCOM) was closed from Tuesday to Thursday due to Golden Week holidays.

The Tokyo Commodity Exchange rubber contract for October delivery <0#2JRU:> finished 4 yen lower at 183.5 yen (US$1.72) per kg, marking its fourth straight session of falls, and a decline of 5.8% for the week, the sharpest weekly decline in four months. Earlier in the day, it hit a low of 181.4 yen, the lowest since April 11.

"There is a sense of caution in China for high commodities prices," said a Tokyo-based source with a broker.

"One example is the release of 3,000 tonnes of pork from Chinese reserves. While Tokyo was closed, Shanghai rubber declined gradually and TOCOM caught up with that."

Beijing will release 3.05 million kilograms of frozen pork from its reserves over the next two months to combat rising pork prices, the city government said on Wednesday.

The US dollar was trading around 106.95 yen, recovering slightly after hitting an 18-month low of 105.55 on Tuesday.

The most-active rubber contract on the Shanghai futures exchange for September delivery fell 290 yuan to finish at 12,260 yuan (US$1,885.37) per tonne.

The front-month rubber contract on Singapore's SICOM exchange for June delivery last traded at 146.20 US cents per kg, up 0.6 cent.

(US$1 = 106.9500 yen)

(US$1 = 6.5027 Chinese yuan)