SINGAPORE: Japanese rubber futures hit a four-week high on Thursday, tracking gains in the Shanghai market, while tight raw material supply from top producer Thailand and upbeat domestic factory output data also provided support.
The Osaka Exchange rubber contract for September delivery finished 3.6 yen, or 1.4%, higher at 259.9 yen ($2.13) per kg, the highest since March 3.
Production at some tyre factories in China may still be impacted due to the spike in COVID-19 cases, but there has been improvement in rubber consumption, a Singapore-based trader said.
Raw material output from Thailand is also tight since many rubber tappers are taking a break until the country’s traditional new year, or Songkran, in mid-April, he added.
Japan’s factory output posted its first rise in three months in February as robust global demand led to a rebound in car production, a welcome sign for policymakers hoping to keep the country’s fragile economic recovery on track.
The rubber contract on the Shanghai futures exchange for September delivery rose 230 yuan to finish at 13,880 yuan ($2,188.10) per tonne. Earlier in the session, it touched the highest since March 11 of 13,910 yuan.
Shanghai authorities on Thursday appealed to residents to keep cooperating with tight curbs imposed to stop COVID-19 spreading, saying they recognised their frustrations as China’s most populous city entered the fourth day of a two-stage lockdown.
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