SINGAPORE: Japanese rubber futures steadied on Tuesday, as weakness in Thai raw material prices was offset by a softer yen and China demand recovery hopes as the country continued to relax its COVID-19 curbs.
The Osaka Exchange rubber contract for December delivery finished 0.2 yen, or 0.1%, higher at 259.2 yen ($1.91) per kg.
Thai rubber sheet prices hit 71.00 baht ($2.02) per kg on Tuesday, their lowest since February 11.
Thai latex prices hit their lowest level since Jan. 26 at 43.35 baht per kg on Tuesday.
The dollar traded at 135.69 yen against 134.88 yen on Monday afternoon in Asia. A weaker yen makes yen-denominated assets more affordable when purchased in other currencies.
There is optimism in the market as China continues to ease its COVID restrictions and traders are more convinced that “the worst is over” for China, said a Singapore-based trader.
However, there are still some bearish views that demand in China will not improve significantly over the next three months, he added.
The rubber contract on the Shanghai futures exchange for September delivery was up 100 yuan to finish at 12,930 yuan ($1,933.54) per tonne, after hitting its highest since June 14 of 12,965 yuan earlier in the session.
China will roll out tools in its policy reserve in a timely way to cope with more economic challenges, as COVID-19 outbreaks and risks from the Ukraine crisis pose a threat to employment and price stability, a state planner official said on Tuesday.
The country on Tuesday slashed the quarantine time for inbound travellers by half in a major easing of one of the world’s strictest COVID-19 curbs, which have deterred travel in and out of the country since 2020.
The front-month rubber contract on Singapore Exchange’s SICOM platform for July delivery last traded at 162.9 US cents per kg, up 0.8%.