SINGAPORE: Japanese rubber futures edged higher on Wednesday on hopes the United States would cut tariffs on Beijing, while signs of lower COVID-19 infections in top buyer China lifted investor sentiment.
The Osaka Exchange rubber contract for October delivery finished up 0.9 yen, or 0.4%, at 249.1 yen ($1.92) per kg.
“COVID-19 cases are easing in Shanghai and Beijing. People are weighing in that a COVID-19 turnaround may be around the corner,” a Singapore-based trader said.
US President Joe Biden said on Tuesday discussions were ongoing about potentially dropping US trade tariffs on China that were imposed by his predecessor, Donald Trump.
The rubber contract on the Shanghai futures exchange for September delivery rose 140 yuan to finish at 12,780 yuan ($1,900.99) per tonne.
Shanghai officials said on Wednesday that half the city had achieved “zero COVID” status, but uncompromising restrictions had to remain in place under a national policy which the head of the World Health Organization described as “unsustainable”. China’s factory-gate inflation eased to a one-year low in April as state-driven production efforts supported supply and COVID lockdowns in key industries cooled demand, giving policymakers headroom for more stimulus to shore up a flagging economy.
The front-month rubber contract on Singapore Exchange’s SICOM platform for June delivery last traded at 159.1 US cents per kg, down 0.1%.