SINGAPORE: Japanese rubber futures climbed on Friday as positive automotive production plans and optimistic demand forecast for automobiles in 2024 lifted outlook for tyre demand, while a weaker yen also lent support.

The Osaka Exchange (OSE) rubber contract for June delivery closed up 1.4 yen, or 0.52%, at 271.3 yen ($1.83) per kg, the highest close since Nov. 16. The contract recorded a weekly gain of 4.11%, and marked the sixth consecutive weekly gain, the longest since November 2019. The rubber contract on the Shanghai Futures Exchange (SHFE) for May delivery was up 100 yuan to close at 13,875 yuan ($1,928.48) per metric ton.

Top electric vehicle maker BYD said it is on track to build facilities in Indonesia with a production capacity of 150,000 vehicles later this year. Honda Motor said it expects US full-year sales to jump between 10% and 15% from a year-ago period. US retail sales rose more than expected in December, boosted by an increase in motor vehicle and online purchases.

“Amid a strong end to the year for many automotive sales, some closure of European automotive factories may have a delayed spillover effect in terms of shipments - something market participants need to watch out for,” said Farah Miller, CEO of Helixtap Technologies, an independent rubber-focused data company.

Automotives such as Volvo and Tesla, and tyre-maker Michelin had announced plans to halt productions due to the attacks on vessels by Iranian-backed Houthi in Yemen.

Japan’s benchmark Nikkei average closed 1.4% higher. The yen weakened 0.22% to 148.51 against the dollar. A weaker currency makes yen-denominated assets more affordable to overseas buyers. China will take measures against superfluous new energy vehicle projects (NEV) and disruptive competitive practices in NEV sales, vice industry minister Xin Guobin said on Friday.