SINGAPORE: Japanese rubber futures extended losses for a third session on Monday, with the market hitting an eight-month low, tracking losses in the Shanghai market, as weaker oil prices and continued concerns over weak demand in top consumer China weighed.
The Osaka Exchange rubber contract for January delivery was down 2.2 yen, or 1%, at 226.5 yen ($1.70) per kg as of 0200 GMT.
The rubber contract on the Shanghai futures exchange for January delivery was down 185 yuan, or 1.4%, at 12,840 yuan ($1,902) per tonne. Japan’s economy expanded for a third straight quarter on solid private consumption, data for April-June showed on Monday, although the outlook remains uncertain due to a resurgence in COVID-19 infections, slowing global growth, supply constraints and rising raw material prices that are boosting households’ living costs.
China’s industrial output and retail sales fell short of expectations in July, following figures over the weekend that showed new bank lending in China had also tumbled more than anticipated. * There were concerns in the past months over slowing rubber demand in China as extended lockdowns, including the latest in Hainan – which is the largest contributor to the nation’s rubber production capability, result in reduced industrial activity and consumption.
Mainland China’s Health Commission reported 2,478 new coronavirus cases for Aug. 14, compared with 2,604 new cases the previous day.
Oil prices dropped for a second session on Monday after the head of the world’s top exporter, Saudi Aramco, said it is ready to ramp up output while production at several offshore US Gulf of Mexico platforms is resuming after a brief outage last week.
Asian shares inched higher on Monday with investors anxious to see if Wall Street can sustain its rally as hopes US inflation has peaked will be tested by likely hawkish commentary from the Federal Reserve this week.
The front-month rubber contract on Singapore Exchange’s SICOM platform for September delivery last traded at 150.4 US cents per kg, down 1.1%.