Singapore dealers have bought Indonesia's SIR20 and Thailand's STR20 for December/January delivery to China, the world's largest consumer. The deals were done late on Monday and traders expected prices to fall further as supply weighed.
"I heard STR20 has been traded at $1.57 a kg. It's quite low but there's no choice because there's plenty of raw material," said one dealer in Malaysia's northern state of Penning.
"Thailand can compete with other sellers now. Their prices have been very high for such a long time that nobody wanted to buy from them," the dealer said.
Malaysia's SMR20 fell to $1.57 a kg for December delivery from $1.59 a kg on Monday, dealers said. Dealers said heavy rains have subsided in some growing areas in Thailand allowing tapping to resume.
More supplies put pressure on the price of STR20, which had been quoted at around $1.62 a kg on Monday. Thailand is the world's largest rubber producer, producing both rubber sheet and block rubber.
Its key buyers are Japan, China and the United States. The prospect of more supplies from Thailand depressed the market in Japan. The benchmark April 2006 contract on the Tokyo Commodity Exchange (TOCOM) fell 1.5 yen per kg to 187.1 yen in afternoon trade, extending on Monday's falls.
The most active contract has been hit by profit-taking since striking a 17-year high of 206.6 yen on October 12 on fund buying driven by low domestic inventory levels in Japan and tight supplies from major producers.
Indonesia, the world's second-largest producer, was still on holiday to mark the Muslim Eid-ul-Fitr celebration but dealers noted overnight deals for tyre-grade SIR20.
SIR20 was sold at around $1.54 a kg free on board Plumbing in Sumatra for December shipment and at $1.55 a kg free on board Bengkulu, also in Sumatra, said dealers.
"US buyers have been absent for some time but we do see interest from Singapore dealers who will send the rubber to China," said one dealer in Jakarta.
Offers for SIR20 stood at $1.55 free on board plumbing, down from $1.57 a kg. Weak Tokyo futures put pressure on the market in China, where the most active March rubber contract on the Shanghai Futures Exchange fell 230 yuan per tonne to 16,985 yuan in afternoon trade.