SINGAPORE: Japanese rubber futures snapped a four-day rally on Friday but still logged a second consecutive weekly rise, helped by higher physical prices in top producer Thailand and stronger oil prices.
The Osaka Exchange (OSE) rubber contract for October delivery closed down 0.5 yen or 0.16% at 322 yen ($2.07) per kg. It gained 5.16% this week, its best week since March 22.
On the other hand, the Shanghai Futures Exchange’s (SHFE) rubber contract for September delivery rose 115 yuan to finish at 14,685 yuan ($2,033.62) per metric ton.
The price of Thailand’s benchmark export-grade smoked rubber sheet (RSS3) rose 6.43% week-on-week. “The recent tariffs against China were positive for Malaysian glove makers, which boosted short term demand amongst latex processors in Thailand,” said Farah Miller, CEO of Helixtap Technologies, an independent rubber-focused data company. Top rubber consumer China’s stimulus announced on Monday also contributed to elevated prices, Miller added.
China’s factory output topped forecasts in April, helped by improving external demand, although retail sales unexpectedly slowed and the property sector remained sluggish.
China on Friday announced some of its most sweeping measures yet to stabilise the crisis-hit property sector, from lower borrowing costs to plans for local governments to buy “some” apartments and vowing more efforts to deliver unfinished homes.
Thailand’s meteorological agency warned of “severe weather conditions”, “heavy to very heavy rains” and “flash floods” from May 17-22. Oil prices rose on signs of improving global demand amid stronger economic indicators from key consumers China and the United States.
Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil. The front-month rubber contract on Singapore Exchange’s SICOM platform for June delivery last traded at 168 US cents per kg, down 0.77%.
Comments
Comments are closed.