SINGAPORE: Japanese rubber futures fell for a fourth straight session on Wednesday, giving up earlier gains, as lingering demand concerns overshadowed support from tighter inventories. The Osaka Exchange’s rubber contract for January delivery finished 0.2 yen, or 0.1%, lower at 201.5 yen ($1.43) per kg, hovering near its lowest level in almost two years.
The OSE’s July contract expired at 203.1 yen per kg on Tuesday. The rubber contract on the Shanghai futures exchange for September delivery rose 100 yuan to finish at 12,200 yuan ($1,705.48) per metric ton. Japan’s benchmark Nikkei average closed 0.04% lower. Production in Thailand will decrease for the next two weeks due to rain and flooding in areas of rubber plantation, said a Singapore-based trader.
China’s support does help raise trader confidence and we can see some arbitrage traders coming out to do some spread trading, the trader said, adding demand remained weak in China for now. China’s top leaders pledged on Monday to step up policy support for the economy amid a tortuous post-COVID recovery, focusing on boosting domestic demand, signalling more stimulus steps.
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