BEIJING (March 27): Benchmark Tokyo rubber futures ended 1.5% higher on Tuesday, after hitting a 17-month low in the previous session, as concerns about a potential trade spat between the United States and China eased.
Tokyo Commodity Exchange (TOCOM) futures, which set the tone for rubber prices in Southeast Asia, recovered on optimism that two of the world’s largest economies are set to begin negotiations on trade.
“The recovery was due to the news that trade war was easing, which gave the whole commodities market a boost,” said Quan Shuwen, a senior analyst with Horizon Insights, a consultancy based in Shanghai.
“But from the supplies and demand angle, pressure is still on. Prices in China in the first half of the year will remain relatively weak,” Quan said.
The world stocks and equity market pared losses, after a Wall Street Journal report that Treasury Secretary Mnuchin was considering a visit to Beijing to begin negotiations.
The Tokyo Commodity Exchange rubber contract for September delivery finished 0.3 yen higher at 179.1 yen (US$1.70) per kg.
The most active rubber contract on the Shanghai futures exchange for May delivery rose 70 yuan (US$11.19) to finish at 11,140 yuan per tonne.
The front-month rubber contract on Singapore’s SICOM exchange for April delivery last traded at 134.80 U.S. cents per kg, up 1.7 cents.
The yen rose 0.1% against the dollar on Tuesday.
(US$1 = 105.6400 yen)
(US$1 = 6.2570 Chinese yuan)