Rubber at 3-Week High as Yen Weakens While China Optimism Rises
Rubber advanced to the highest level in more than three weeks as Japan’s currency weakened, raising the appeal of the yen-based futures, and amid speculation China may increase imports of the commodity used in tires.
Rubber for delivery in October gained as much as 1.4 percent to 274.60 yen a kilogram ($2,772 a metric ton), the highest since April 15 and traded at 273.4 yen at at 11:23 a.m on the Tokyo Commodity Exchange. Futures rallied 6.8 percent yesterday, the biggest gain since Nov. 14, 2011.
The yen weakened to 99.12 per dollar, nearing to a four- year low of 99.95 reached on April 11. China may increase imports of the raw material to take advantage of low international prices, said Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo. Natural rubber imports by China were 230,000 metric tons in April, the customs agency said today, compared with 234,044 tons in March and 167,618 tons a year ago.
“China may step up rubber purchases on hopes for demand recovery later this year,” he said today by phone.
Rubber inventory in Qingdao, China’s main hub for the commodity, rose to a record last month, as imports gained while demand remained tepid amid slowing economic growth. Stockpiles in the bonded zone, where traders store deliveries before paying duties, climbed to 371,100 metric tons at the end of April from 366,900 tons on April 15, according to Cai Zhiwei, general manager at the Qingdao International Rubber Exchange Market.
Rubber for delivery in September on the Shanghai Futures Exchange added 1.1 percent to 20,050 yuan ($3,264) a ton. Thai rubber free-on-board jumped 3.5 percent to 88.85 baht ($3) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
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