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Wednesday, December 8, 2021

Rubber Recovers as Thailand May Extend Export Cut, Yen Weakens

Rubber rebounded from the biggest drop in almost eight months as Thailand, the top producer, said it would propose extending a reduction in shipments. The Japanese currency weakened, making yen-based contracts more attractive.

The contract for delivery in August gained as much as 2.6 percent to 277.8 yen a kilogram ($2,903 a metric ton) on the Tokyo Commodity Exchange before trading at 276 yen at 12:02 p.m. Futures plunged 4.2 percent yesterday, the most since July.

Thailand, Indonesia and Malaysia, who represent 70 percent of global output, will meet in Phuket on April 10-12, Deputy Farm Minister Yuttapong Charasathien said today. The yen weakened for the first time in four days against the dollar, trading at 95.69, before a change of leadership at the Bank of Japan takes effect tomorrow amid expectations for policy easing.

“The possibility of extending the export-cut program provided support, boosting gains,” Chaiwat Muenmee, an analyst at DS Futures Co., said by phone from Bangkok.

The contract for September delivery on the Shanghai Futures Exchange gained 1.4 percent to 22,580 yuan ($3,631) a ton.

Thai rubber free-on-board dropped 0.8 percent to 85.60 baht ($2.92) a kilogram yesterday, the Rubber Research Institute of Thailand said on its website. That was the lowest level since November 2009, according to data compiled by Bloomberg.

Source: Bloomberg

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