SINGAPORE: Japanese rubber futures rose to snap a four-day losing streak on Friday, buoyed by supply disruptions and firmer synthetic rubber prices, but logged their largest weekly loss in almost six months amid global economic uncertainties.
The Osaka Exchange (OSE) rubber contract for February delivery closed up 2.3 yen, or 0.66%, at 349.8 yen ($2.46) per kg.
The contract lost 6.87% for the week, posting its largest weekly loss since March 22. The January rubber contract on the Shanghai Futures Exchange (SHFE) rose 360 yuan, or 2.22%, to 16,545 yuan ($2,334.89) per metric ton.
Friday’s recovery in natural rubber prices is largely driven by a relatively less comfortable supply in key physical markets during the usual peak global production season, while an uptrend in butadiene rubber prices is also lending support, said Jom Jacob, chief analyst at Indian analysis firm What Next Rubber.
However, gains will be limited by a clouded demand outlook amid new concerns over a potential US economic slowdown and persistent weakness in China’s manufacturing sector.
Expectations of China selling older rubber inventory this week caused movements downwards on the SHFE and other futures markets, said Farah Miller, CEO of independent rubber-focused data firm Helixtap Technologies.
Thailand’s meteorological agency warned of heavy to very heavy rains that may cause flash floods from Sept. 6-12. The most active October butadiene rubber contract on the SHFE rose 205 yuan, or 1.39%, to 14,935 yuan ($2,107.68) per metric ton.
China’s central bank hinted at more easing on Thursday, but investors interpreted the signal as official recognition of economic weakness.
The front-month October rubber contract on Singapore Exchange’s SICOM platform last traded at 180.5 US cents per kg, up 2%.
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