SINGAPORE: Japanese rubber futures dropped on Thursday, pressured by a stronger yen and falling synthetic rubber prices, while investors looked ahead to an important economic meeting in Beijing.
The May Osaka Exchange (OSE) rubber contract was down 2.6 yen, or 0.69%, at 357.7 yen ($2.35) per kg, as of 0220 GMT.
The May rubber contract on the Shanghai Futures Exchange (SHFE) rose 155 yuan, or 0.83%, to 18,815 yuan ($2,589.74) per metric ton.
The most active February butadiene rubber contract on the SHFE fell 115 yuan, or 0.84%, to 13,595 yuan ($1,871.25) per metric ton.
The dollar on Thursday eased 0.21% to 152.14 yen, after rising to 152.845 yen in the previous session, its strongest level since Nov. 27.
A stronger currency makes yen-denominated assets less affordable to overseas buyers.
Volatility in the natural rubber market has intensified since December, with significant influence from both macro and fundamental factors, Chinese financial data provider Tonghuashun Information said.
In the short term, disruptions to rubber tapping in southern Thailand, low domestic inventories, and optimism about China’s upcoming economic meeting will support the market as it fluctuates at a high level, added Tonghuashun.
Top producer Thailand’s meteorological agency warned of heavy rains that may cause flash floods from Dec. 12-16.
Top consumer China is scheduled to hold its Central Economic Work Conference this week, where it will set policy priorities including its annual growth goal for the coming year.
country’s leaders and policymakers are considering allowing the yuan to weaken in 2025 as they brace for a second Trump presidency, reflecting Beijing’s recognition that it needs bigger economic stimulus to combat Trump’s threats of punitive trade measures.
The front-month January rubber contract on Singapore Exchange’s SICOM platform last traded at 202.2 U.S. cents per kg, down 0.6%.
Comments