Jan. 8 (Bloomberg) -- Rubber advanced to near an eight-month high on optimism China, the biggest buyer, will increase inventories ahead of holidays next month.
Rubber for delivery in June gained 0.6 percent to settle at 305.6 yen a kilogram ($3,498 a metric ton) on the Tokyo Commodity Exchange. The most-active contract rose to 313.7 yen yesterday, the highest level since May 7.
Futures also climbed as oil traded near a four-month high in New York, raising the appeal of natural rubber as an alternative to synthetic products used in tires, before a government report that may show refinery utilization rose and stockpiles increased in the U.S. Natural-rubber inventories gained 1,770 tons to 97,697 tons, the highest since March 2010, the Shanghai Futures Exchange said on Jan. 4.
“Rising crude oil prices are supportive,” Chaiwat Muenmee, an analyst at DS Futures Co., said by phone from Bangkok. Optimism that China will build up stocks ahead of Chinese New Year also gave a boost, he added. China’s markets are closed in the week beginning Feb. 11 for the holiday.
Gains were limited by the Japanese currency heading for the biggest two-day gain in five weeks, extending a rally from its 2 1/2 year low, said Naohiro Niimura, a partner at research company Market Risk Advisory in Tokyo.
Rubber for delivery in May added 0.4 percent to close at 26,180 yuan ($4,205) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board fell 1 percent to 101.35 baht ($3.33) a kilogram today, according to the Rubber Research Institute of Thailand.
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