The benchmark contract rose as high as 296.2 yen, the highest since May 9. The yen sank to a 20-month low of 85.38 to the dollar in Asian trading on Wednesday, as Shinzo Abe assumed Japan's helm with a mandate to weaken its currency and push for more drastic monetary and fiscal stimulus.
The weaker yen makes the dollar-based commodity expensive and usually encourages players to take speculative buying positions in TOCOM rubber. The yen's decline of 1 yen, theoretically, pushes up Tokyo rubber by 2.5 yen to 3.0 yen per kg, said a Tokyo-based broker.
Tokyo rubber has kept gains after news that Indonesia's rubber production will slip to 2.771 million tonnes next year from 3.040 million tonnes this year. The most-active rubber contract on the Shanghai futures exchange for May delivery rose 85 yuan to finish at 25,320 yuan ($4,100) per tonne. The front-month rubber contract on Singapore's SICOM exchange for January delivery last traded at 294.00 US cents per kg, up 5.0 cents. Crude rubber inventories at Japanese ports had climbed to a two-week high of 6,352 tonnes by Dec. 10, after rising 149 tonnes in the previous 10 days, data from the Rubber Trade Association of Japan showed on Wednesday.