UPDATE 1-Asia Softs-Yen guides rubber; Thai millers may lift sugar premiums
* TOCOM rubber seen in 260-270 yen/kg range this week
* Thai millers may raise sugar premiums after NY futures fall
* Cocoa butter ratios hold at strongest since 2008 (Updates rubber price; adds technicals)
By Lewa Pardomuan
SINGAPORE, Aug 19 (Reuters) - Tokyo rubber prices, which set the tone for the physical market, could test a key resistance level this week if the yen extends losses, while Thai sugar millers are likely to push up premiums after New York futures fell, dealers said on Monday.
A supply squeeze and demand from chocolate makers could also keep butter ratios in Asia at their highest level since 2008.
Indonesian coffee premiums, meanwhile, could slip because of quality concerns due to heavy rains.
The most active January rubber contract on the Tokyo Commodity Exchange (TOCOM) was little changed at 266.5 yen a kg. It settled 2.7 yen higher on Friday, marking a 2.3 percent weekly gain.
Tyre grade prices will track TOCOM rubber higher, after plunging to multi-year lows recently on worries about global economic growth and uncertain demand from top consumer China.
"I think the performance of the yen is likely to be the main driver of TOCOM rubber this week. If we see a further weakening in the yen, there's a chance it will break through 270 yen," said Lee Chen Hoay, investment analyst at Phillip Futures in Singapore. "The support level will be 260 yen."
A weaker Japanese currency makes yen-denominated Tokyo futures more attractive for speculators. The dollar edged up against a basket of currencies on Monday, with the near-term focus on the minutes of the U.S. Federal Reserve's July policy meeting due later this week.
In the sugar market, premiums for Thai raws could edge up because of a recent drop in benchmark New York futures. Futures and premiums usually move in opposite directions.
"Several factors such as strong harvest progress in Brazil, a falling Brazilian currency and a minimal spec short position could see prices pressured further this week," said Tom McNeill, director at commodity analysis company Green Pool in Brisbane, referring to New York futures.
"But things are very quiet in the physical market ... There is some disinterest in selling, as millers continue to remelt raws into whites."
New York October raws fell 1.5 percent to settle at 16.94 cents per pound on Friday, its lowest close in a week, on a tumbling real and a quickening harvest pace in top grower Brazil.
Early indications showed Thai high polarisation, or hipol, raw sugar stood at premiums of 100 to 130 points to New York futures, little changed from last week but higher than 75 to 80 points two weeks ago.
COFFEE PREMIUMS, COCOA BUTTER RATIOS
Premiums for Vietnamese robustas could hold steady at $50 to $70 to London futures this week, but the value of Indonesian beans may drop after mouldy beans entered the physical market.
The harvest in Indonesia has been plagued by incessant rains, which have disrupted the drying of beans and deliveries from plantations to the major export port on the main growing island of Sumatra.
In the cocoa market, butter ratios could surpass last week's levels of 2.35 to 2.40 times London futures, buoyed by strong demand from chocolate makers. (Editing by Tom Hogue and Muralikumar Anantharaman)
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