Rubber fell to a one-week low on speculation that decreasing oil prices would cut the cost of synthetic products, decreasing the appeal of the natural variety.
Rubber for delivery in October dropped as much as 2.3 percent to 276.3 yen a kilogram ($2,707 a metric ton) on the Tokyo Commodity Exchange, the lowest price for the most-active contract since May 9. Futures were at 279.9 yen at 11 a.m., set for a third day of decline and a weekly loss of 4.7 percent.
Crude for June delivery traded at $94.02 a barrel in electronic trading on the New YorkMercantile Exchange after slumping as much as 2.2 percent yesterday to the lowest level since May 2. The Japanese currency advanced against the dollar after data showed the world’s third-largest economy expanded last quarter more than analysts had estimated, weakening the appeal of yen-denominated contracts.
“A weaker oil market put a drag on rubber futures amid a lack of support from the currency market,” Hideshi Matsunaga, an analyst at broker ACE Koeki Co. in Tokyo, said by phone today.
Japan’s gross domestic product rose an annualized 3.5 percent in the first quarter, the most in a year, a Cabinet Office report showed today in Tokyo. The median estimate of 36 economists in a Bloomberg News survey was for a 2.7 percent gain.
Thai rubber free-on-board dropped 0.3 percent to 89.55 baht ($3.02) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
Rubber for delivery in September on the Shanghai Futures Exchange was little changed at 19,870 yuan ($3,231) a ton. Inventory in Qingdao, China’s main hub for the commodity, fell to 363,300 tons from record 371,100 tons on April 26, Cai Zhiwei, general manager at the Qingdao International Rubber Exchange Market, said yesterday.
Source: Bloomberg
