TOCOM climbs on softer yen; producers' talks awaited

Benchmark Tokyo rubber futures on Friday climbed above the key 200-yen mark, extended gains into a third straight session while posting their first weekly gain in four, on a weaker yen and news that rubber producers will meet this weekend to discuss prices.

The International Rubber Consortium (IRCo) will hold an internal meeting of itsCommittee on Strategic Market Operations (CSMO) this weekend in Indonesiato discuss falling rubber prices.

"The meeting is periodically reviewing price development and market situation,"Moenarji Soedargo, chairman at Indonesia Rubber Association, told Reuters by phone on Friday.

"Monitoring price is part of CSMO meeting routine. As the price is under pressure, this should be our concern," he said, but declined to comment on any further details about the meeting.

The Tokyo Commodity Exchange (TOCOM) rubber contract for November delivery finished up 1.6 yen, or 0.8 percent, at 201.0 yen ($1.81) per kg. Earlier in the session, it hit 204.0 yen, highest since May 31.

For the week, it increased 7.5 percent, the biggest gain since late January.

"The yen's decline also lent support," said Hiroyuki Kikukawa, general manager of research, Nissan Securities.

The U.S. dollar rose 0.2 percent to 111.18 yen, on track to gain 1.1 percent for the week, after upbeat U.S. economic data gave investors reason to hope the U.S. central bank will stick with its plan to hike rates.

A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.

"If producer group comes up with some measures to shore up prices and a yen drops further while oil prices rebound, the TOCOM prices may continue to rise next week," Kikukawa said.

"But an overall market tone is still bearish due to an oversupply in China," he said.

Rubber inventories in warehouses monitored by the Shanghai Futures Exchangerose 1.8 percent from the previous Friday, the exchange said on Friday.

The most-active rubber contract on the Shanghai futures exchange for September delivery rose 55 yuan to finish at 12,875 yuan ($1,889) per tonne.

The front-month rubber contract on Singapore's SICOM exchange for July delivery last traded at 146.4 U.S. cents per kg, down 0.1 cent.

($1 = 111.2000 yen)

($1 = 6.8141 Chinese yuan)