SHANGHAI: Japanese rubber futures hit a one-month low on Friday and posted a third straight weekly loss, as improving weather conditions in top producer Thailand raised expectations of higher supplies and demand from downstream industries stayed subdued.
The Osaka Exchange (OSE) rubber contract for April delivery was down 2.60 yen, or 0.58 percent, at 442.40 yen (USD2.80) per kg. It touched its lowest since September 29 earlier in the day. The contract lost 1.23 percent this week.
The rubber contract on the Shanghai Futures Exchange (SHFE) for January delivery fell 100 yuan, or 0.52 percent, to 19,170 yuan (USD2,877.95) per metric ton.
The most-active December butadiene rubber contract on the SHFE rose 465 yuan, or 2.77 percent, to 17,245 yuan per ton.
Raw material price increases have slowed after the weather cleared in northeastern Thailand, though prices are still at historically high levels, analysts from broker Dongwu Futures said in a note. Thailand’s meteorological agency forecast less rain with only isolated heavy showers in the south from October 29 to November 4.
Downstream operations rebounded after China’s Golden Week holiday in early October, but end-users have limited capacity to absorb high prices, the Dongwu analysts said.
Thai domestic rubber prices reached their highest in a decade this year, with benchmark ribbed smoked sheet grade 3 (RSS3) peaking at 97.9 baht per kg through October 27, data from the Rubber Authority of Thailand (RAOT) showed.
Prices are expected to stay high in the fourth quarter on tight global supply, with possible further rises in some periods, RAOT acting governor Sansana Suriyothin said on Wednesday, according to local reports. The front-month rubber contract on Singapore Exchange’s SICOM platform for January delivery last traded at 245.10 US cents per kg, down 0.6 percent as of 0700 GMT.