SHANGHAI: Japanese rubber futures rose on Thursday, as firm raw material costs from rainfall disruption in producing regions countered weak demand from tyre manufacturers in top rubber consumer China.
The Osaka Exchange (OSE) rubber contract for March delivery was up 3.9 yen, or 0.86percent, at 456.8 yen (USD2.89) per kg. The Shanghai Futures Exchange will be closed from October 1 to 7 for China’s National Day holiday, the bourse said. Trading will resume on Thursday, October 8.
Rainfall in China’s Hainan and Yunnan has hindered short-term raw material procurement domestically, while a rebound in rainfall in Thailand has kept latex and cup lump prices firm, analysts from broker Ningzheng Futures said in a note.
Low all-steel tyre inventories and continued destocking in Qingdao are providing further support, the analysts said. Pre-holiday stockpiling has now concluded and pressure on tyre manufacturers’ profits may limit any improvement in demand, said analysts from broker Zhongcai Futures in a note.
Elsewhere, floods in Thailand have disrupted parts deliveries to Toyota’s Thai unit and caused the temporary shutdown of four of its plants.
The price of Thailand’s benchmark export-grade smoked rubber sheet (RSS3) was up 1.83percent, while block rubber was down 1.38percent. The front-month rubber contract on Singapore Exchange’s SICOM platform for December delivery last traded at 255.1 US cents per kg, up 0.3percent as of 0703 GMT.