Oct. 7 (Bloomberg) -- Rubber recovered from an almost two-month low on bets that demand from China, the world’s largest user, may increase as buyers return from a week-long holiday.
The contract for March delivery on the Tokyo Commodity Exchange advanced 1.1 percent to settle at 257 yen a kilogram ($2,648 a metric ton). The price touched 253.8 on Oct. 4, the lowest intra-day level since Aug. 8. Futures slid 5.9 percent last week, the worst for a most-active contract since the five days through May 24.
The Shanghai Futures Exchange reopens tomorrow after National Day holidays. Rubber inventories in Qingdao, China’s main hub for the commodity, fell to 283,100 tons as of Sept. 16 from a record 371,000 tons on April 26, according to the Qingdao International Rubber Exchange. China may step up buying to replenish stockpiles, said Kazuhiko Saito, an analyst at broker Fujitomi Co. in Tokyo.
“Expectations for a pick-up in Chinese demand provide support to futures,” Saito said today by phone.
Gains were limited as the Japanese currency strengthened against the dollar, weakening the appeal of yen-denominated contracts, as U.S. lawmakers continue to scrap over raising the debt limit amid a government shutdown. U.S. House of Representatives Speaker John Boehner said lawmakers won’t raise the debt ceiling without packaging it with other provisions.
Thai rubber free-on-board was unchanged at 78 baht ($2.49) a kilogram today, according to the Rubber Research Institute of Thailand.
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