Rubber Rallies to Eight-Month High on Weak Yen, China Exports

Rubber climbed to the highest level in more than eight months after the Japanese yen neared a 2 1/2 year-low and exports from China exceeded forecasts.

Rubber for delivery in June jumped 1.7 percent to close at 313.3 yen a kilogram ($3,555 a metric ton) on the Tokyo Commodity Exchange, the highest settlement for the most-active contract since May 2. Futures have gained 3.6 percent this year, extending last year’s advance of 15 percent.

The yen weakened for a second day before data forecast to show the nation’s trade deficit widened, raising the appeal of contracts denominated in the Japanese currency. China’s exports rose 14.1 percent in December from a year earlier, beating a median estimate of 5 percent from 40 analysts in a Bloomberg News survey, helping the nation sustain a pickup in economic growth after a seven-quarter slowdown.

“A weakening yen and better-than-expected Chinese trade data are key drivers,” Sureerat Kunthongjun, an analyst at AGROW Enterprise Ltd., said by phone from Bangkok. Investors are also optimistic that China will build inventories ahead of the long holidays next month, she said.

Markets in China, the biggest rubber user, will be closed in the week beginning Feb. 11 for the Lunar New Year holiday.

Vehicle sales in the country, the world’s largest auto market, may rise about 5 percent this year and reach 20 million units, spurred by a rebound in economic growth and rising incomes, said Ye Shengji, deputy secretary general of the state-backed China Association of Automobile Manufacturers. Total auto sales, which include passenger and commercial vehicles, rose 4 to 5 percent in 2012 to about 19 million units, he said in an interview today.

Rubber for delivery in May gained 0.7 percent to close at 26,205 yuan ($4,210) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board rose 1 percent to 102.55 baht ($3.37) a kilogram today, according to the Rubber Research Institute of Thailand.

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