Rubber Surges Most Since November 2011 as Yen Drop Raises AppealAya Takada
Rubber jumped by the most since November 2011 after Japan’s currency slid to an almost four-year low, boosting the appeal of yen-denominated futures.
The contract for delivery in September climbed 6.6 percent to settle at 270.3 yen a kilogram ($2,737 a metric ton) on the Tokyo Commodity Exchange, the biggest daily advance since Nov. 14, 2011. The rally pared this year’s loss to 11 percent.
The yen traded at 98.95 per dollar after touching 99.01, the lowest since May 2009. The currency extended losses for a third day after the Bank of Japan said last week it would double bond buying to reach its target of 2 percent annual inflation within two years. Toyota Motor Corp., the world’s largest carmaker, led a rally in Japan’s Nikkei 225 Stock Average toward its highest level in almost five years.
“The BOJ’s record stimulus sent the yen tumbling against the dollar, which boosted investor appetite for futures,” Kazuhiko Saito, an analyst at broker Fujitomi Co. in Tokyo, said today by phone.
Japan’s currency, traditionally considered a haven, fell against the greenback even as a Labor Department report showed U.S. payrolls grew by 88,000 workers in March, the least in nine months. The median forecast in a Bloomberg survey of economists was for a gain of 190,000.
Rubber in Tokyo plunged into a bear market on April 1, when the most-active contract lost more than 20 percent from this year’s highest settlement of 334 yen.
Thailand, Indonesia and Malaysia, the top producers representing 70 percent of global output, will meet April 10-12 in Phuket to discuss price support measures, including extending an export reduction, Thai Deputy Farm Minister Yuttapong Charasathien said April 1. Thailand extended curbs on shipments by 60 days to the end of May to boost prices, Yuttapong said.
The three nations agreed to reduce exports by 300,000 tons in the six months through March after futures in Tokyo slumped to a three-year low of 205.6 yen in August 2012.
The contract for delivery in September added 1.9 percent to close at 21,735 yuan ($3,503) a ton on the Shanghai Futures Exchange. Thai markets are closed today for a public holiday.
Thai rubber free-on-board fell 1.2 percent to 81.75 baht ($2.79) a kilogram on April 5, according to the Rubber Research Institute of Thailand. That was the lowest level since November 2009, data compiled by Bloomberg showed.