Rubber futures climbed for a second day as a rally in oil raised the appeal of the commodity as an alternative to synthetic products used to make tires.
The contract for delivery in July gained as much as 0.6 percent to 333.6 yen a kilogram ($3,585 a metric ton) and settled at 332.1 yen on the Tokyo Commodity Exchange. Futures have increased 9.8 percent this year.
Oil in New York traded near the highest level in more than a week after data from the American Petroleum Institute showed crude inventories fell last week, the first drop in six. Higher oil adds to the cost of producing synthetic rubber.
“Rubber chased a rally in oil amid speculation the global economic recovery will boost demand for industrial commodities,” Kazuhiko Saito, an analyst at broker Fujitomi Co. in Tokyo, said by phone today.
Gains in futures were limited as Japan’s currency rose from an almost three-year low against the dollar, making yen-denominated contracts less attractive to investors, he said.
The yen climbed to 92.83 per dollar after an unidentified Group of Seven official said Japan will be discussed at the G-20 meeting amid concern the currency’s moves have been excessive. Japan is likely to face criticism from its trading partners for weakening the yen to the detriment of economies in developing Asia, Eisuke Sakakibara, a former Ministry of Finance official, said in an interview today.
The Shanghai Futures Exchange is closed this week for holidays. Natural-rubber inventories rose 1,201 tons to 100,015 tons, based on a survey of nine warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin, the bourse said Feb. 8.
Thai rubber free-on-board added 0.5 percent to 98.3 baht ($3.30) a kilogram today, according to the country’s Rubber Research Institute.