SINGAPORE: Japanese rubber futures rose for an eighth consecutive session to an 18-month high on Wednesday, supported by better-than-expected China economic growth data and lingering concerns over potential supply shortages.

The Osaka Exchange (OSE) rubber contract for March delivery was up 3.3 yen, or 1.2%, at 268.5 yen ($1.79) per kg at closing, its highest level since April 6, 2022. The rubber contract on the Shanghai futures exchange (SHFE) for January delivery was down 30 yuan, or 0.2%, at 14,735 yuan ($2,016.06) per metric ton.

The Thai Metrological Department has warned of severe conditions, with gusty winds, heavy-to-very heavy rains and accumulations that may cause flash floods and overflows, potentially affecting supply. China’s economy grew at a faster-than-expected clip in the third quarter, while consumption and industrial activity in September also surprised on the upside, suggesting the recent flurry of policy measures is helping to bolster a tentative recovery.

Japan’s benchmark Nikkei average closed up 0.01%. Oil prices surged as tensions escalated in the Middle East after hundreds were killed in a blast at a Gaza hospital, sparking concerns about potential oil supply disruptions from the region.

Natural rubber often takes direction from oil prices, as it competes for market share with synthetic rubber, which is made from crude oil. Asian shares steadied, as Chinese economic data suggested Beijing’s stimulus measures might finally be gaining traction, but being overshadowed by fears of a widening conflict in the Middle East.

The front-month rubber contract on Singapore Exchange’s SICOM platform for November delivery last traded at 148.9 US cents per kg, down 0.5%.