Rubber was set for a second weekly drop on concern that demand may slow as China, the world’s biggest user, called for property curbs and as European data signaled the region’s recession is worsening.
The contract for July delivery lost as much as 1.2 percent to 294 yen a kilogram ($3,157 a metric ton) on the Tokyo Commodity Exchange, and was little changed at 297.7 yen at 1 p.m. local time. Futures have retreated 7.4 percent this week, the most since the week ended May 11.
Asian stocks plunged yesterday amid concern the Federal Reserve may scale back stimulus and as China’s government told local authorities to curb real estate speculation. Italy’s parliamentary election starts this weekend after data yesterday showed the euro-area’s economy contracted more than forecast.
“Funds continue selling rubber on concerns about the slow economic recovery and weak demand,” Gu Jiong, an analyst at commodity broker Yutaka Shoji Co., said by phone from Tokyo.
Thailand, the largest exporter, will review a program to support prices by purchasing from farmers at the end of March, Deputy Farm Minister Yuttapong Charasathien said Feb. 19. That may signal an increase in supplies.
The contract for September delivery on the Shanghai Futures Exchange gained 0.4 percent to 25,185 yuan ($4,034) a ton. Thai rubber free-on-board fell 3.2 percent to 91.70 baht ($3.07) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
Source: Bloomberg
