SINGAPORE: Japanese rubber futures gained on Friday to end the week higher, buoyed by steadying raw material prices and optimism that Chinese stimulus measures would help boost demand from the world’s top consumer of the commodity.
The Osaka Exchange (OSE) rubber contract for June delivery closed up 1.0 yen, or 0.27%, at 370.6 yen ($2.35) per kg. The contract gained 0.98% for the week. The May rubber contract on the Shanghai Futures Exchange (SHFE) rose 25 yuan, or 0.14%, to finish at 17,645 yuan ($2,417.45) per metric ton.
It lost 0.56% this week. “This week saw raw material prices normalise, especially in Thailand. Sellers in Indonesia were close to their break-even prices and reluctant to go lower,” said Farah Miller, founder of independent rubber-focused data firm Helixtap Technologies.
Some consumers were picking up February spot cargoes this week before the Christmas break, Miller added. China revised upwards on Thursday the size of its economy by 2.7%, but said the change would have little impact on growth this year, as policymakers pledged more stimulus to spur expansion in 2025.
Meanwhile, the World Bank raised its forecasts for China’s gross domestic product growth for 2024 and 2025 to account for the effect of recent policy easing and near-term export strength. China’s GDP growth is now expected at 4.9% in 2024 versus 4.8% that the group had earlier projected.
The yen hovered near a five-month low to the dollar and was last trading at 157.765, as the Federal Reserve’s hawkish messaging contrasted with the Bank of Japan’s cautious approach to further policy tightening.
A weaker Japanese currency makes yen-denominated assets more affordable to overseas buyers. The front-month January rubber contract on Singapore Exchange’s SICOM platform last traded at 193.2 US cents per kg, up 1%.
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