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 Asia Rubber-Thai Unrest Disrupts Transport

SINGAPORE, Sept 9 (Reuters) - A rail strike linked to anti-government protests has disrupted rubber transport in Thailand, the world's main producer, while demand from tyre makers stir up the physical markets, dealers said on Tuesday.

    Bridgestone <5108.T> and Goodyear Tire and Rubber <GT.N> bought Indonesia's SIR20 grade but consumers turned their back on Thai's RSS3 as tight supplies and transport woes kept prices at high levels near $3 a kg, they said.

    "Supplies have been affected by rains and the raw material market is quite firm. I don't hear deals for RSS3 because the price is close to $3, which is a level no buyers can pay," said a dealer in Thailand's southern city of Hat Yai.

    "Train services have stopped because many southerners support the protests. We can only send rubber by trucks and deliveries to Bangkok and Penang in Malaysia have been affected. But it's hard to say how much shipments have been delayed."

    A rail strike since Aug. 29 has paralysed rubber movements in the south, the country's main rubber-growing area, which produces around 90 percent of its annual production of 3 million tonnes.

    The leaders of 43 public sector unions representing 200,000 workers have launched strikes to support a three-month street campaign to force Prime Minister Samak Sundaravej from power.

    "Adding to the continuing raw material problems are heavy rains in Thailand and northern Malaysia and a rapid backing-up of Thai shipments" due to the rail strike, said a dealer in Jakarta.

    "Goodyear and Bridgestone are apparently keen but only partially successful buyers of October (shipments). I mean some sellers are reluctant to trade in case prices rise again," he said.

    SIR20 was traded late on Monday at 131.75 U.S. cents per pound ($2.90 a kg) for October shipment free on board Belawan, Palembang and Padang in Sumatra. January was bid at 126.75 cents per pound.

    Malaysia's SMR20 was offered at $2.95 a kg and Thai RSS3/STR20 at $2.98 a kg on Tuesday -- down from last week's $2.98 and $3.00 respectively.

    Dealers shrugged off an increase in rubber inventories in China, the world's largest consumer, which was due to the arrivals of more stocks from Hainan province -- the country's largest rubber-producing area.

    "I think sentiment is quite OK. Bridgestone and Goodyear want to buy October shipments and India is trying to buy September. People still need nearby rubber and I think there's a bit of tightness on the raw material," said a dealer in Singapore.

    "However, we're governed by other commodities such as gold and oil. Once gold or oil come down, there's a 100 percent chance that rubber will also come down," said the dealer, referring to oil-driven Tokyo rubber futures.

    The key rubber contract on the Tokyo Commodity Exchange <0#JRU:> for February delivery fell 7.9 yen, or 2.6 percent, to 306.0 yen per kg, tracking weaker oil <CLc1>.

    Rubber inventories in warehouses monitored by the Shanghai Futures Exchange rose 9 percent to 49,740 tonnes in the week ended on September 4 from 45,460 tonnes the week before.

 (Additional reporting by Chikafumi Hodo in TOKYO; Editing by Lincoln Feast)

 ((; +65 6870 3834; Reuters