TOKYO (Jan 13): Benchmark Tokyo rubber futures ended up 5.5% on Wednesday, rebounding from a seven-year low and helped by Thailand’s plans to buy rubber above-market prices to support farmers.
Thailand’s government will buy rubber directly from farmers at prices of up to 60 baht a kilogram, nearly double the market price, in a bid to placate increasingly disgruntled farmers as prices dip to a seven-year low, the cabinet said on Tuesday.
“The market has gotten support from the Thai (purchase) plan,” said a source with a Tokyo-based dealer. “This had been said to occur from before, but it still sparked some buy-back overall.”
The Tokyo Commodity Exchange rubber contract for June delivery finished 8.1 yen higher at 155 yen per kg, after rising as high as 155.3 yen.
Though Chinese trade data on Wednesday showed robust rubber imports last month, the rise in Shanghai futures was not as strong as TOCOM, amid lingering worries over slowing growth in rubber demand from the world’s top consumer, sources said.
China’s imports of natural and synthetic rubber rose 43.9% from a year earlier to 410,000 tonnes, preliminary trade data showed. In 2015, Chinese imports rose 15.3% to 4.72 million tonnes.
The U.S. dollar was quoted around 118.23 yen, up from around US$117.56 yen on Tuesday afternoon.
The most-active rubber contract on the Shanghai futures exchange for May delivery rose 155 yuan to finish at 9,850 yuan per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for February delivery, last traded at 108.1 U.S. cents per kg, up 0.3 cent.
