Rubber slumped the most since November 2011 as a report that Bridgestone Corp. may reduce consumption and data showing a slowdown in China’s growth ignited concerns about demand for the commodity used in tires.
The contract for delivery in September lost 6.3 percent to settle at 259 yen a kilogram ($2,639 a metric ton) on the Tokyo Commodity Exchange. Futures on the Shanghai Futures Exchange tumbled by the exchange-imposed daily price limit.
Bridgestone, the world’s largest tiremaker, may use 2.6 percent less rubber this year than projected in February as demand in the U.S. will be slower than forecast, a Nomura Holdings Inc. analyst said in an interview. China’s economic growth unexpectedly lost momentum in the first quarter as gains in factory output and consumption weakened, data showed today.
“The news about Bridgestone underlined weakness in demand for the commodity,” Kazuhiko Saito, analyst at broker Fujitomi Co. in Tokyo, said today by phone.
Rubber stockpiles at Qingdao, China’s largest hub for the tropical commodity, rose to a record 366,900 tons by April 15, the Qingdao International Rubber Exchange Market said in an e-mailed statement today.
“Rubber’s fundamentals showed that supply is going to exceed demand in the foreseeable future,” said Shen Jun, trader at the Shanghai Flow International Trade Co.
More supply is coming on stream with temperatures rising and farms in China’s Yunnan starting production, to be followed by production in Southeast Asia in May and June, Shen said by phone from Shanghai.
Futures also dropped as the yen rose to a one-week high against the dollar, cutting the appeal of the yen-denominated contracts, after the U.S. Treasury said in a report April 12 that Japan must refrain from competitive devaluation
In Shanghai, the contract for September delivery lost 4.7 percent to 20,355 yuan ($3,290) a ton.
Thai rubber free-on-board added 1.2 percent to 83.25 baht ($2.86) a kilogram on April 11, according to the Rubber Research Institute of Thailand. The price rebounded after touching 81.75 baht on April 5, the lowest level since November 2009. Thai markets are closed today for holiday.