SINGAPORE, Sept 9 (Reuters) –
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Japanese rubber futures climbed for a second consecutive session on Monday, as supply disruptions from a major typhoon in China outweighed the top consumer’s faltering demand outlook, while firmer oil prices also lent support.
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The Osaka Exchange (OSE) rubber contract for February delivery JRUc6, 0#2JRU: closed up 6.8 yen, or 1.94%, at 356.6 yen ($2.50) per kg.
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The January rubber contract on the Shanghai Futures Exchange (SHFE) SNRv1 rose 560 yuan, or 3.43%, to finish at 16,880 yuan ($2,374.62) per metric ton.
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Speculative funds on Friday longed their position in anticipation of a potential supply disruption arising from Typhoon Yagi, which hit Hainan, the country’s traditional rubber-growing region, said Jom Jacob, chief analyst at Indian analysis firm What Next Rubber.
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Traders are expected to change their positions once they have a better assessment of damages, as preliminary reports indicate the key rubber-growing areas are outside the regions worst hit by the typhoon, while China’s demand outlook remains weak, Jacob said.
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China’s exports likely grew at the slowest pace in four months in August, as cooling global demand and mounting trade barriers threaten to dim a bright spot in the world’s second-largest economy.
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Meanwhile, the country’s consumer inflation accelerated in August to the fastest pace in half a year but the uptick was due more to higher food costs from weather disruptions than a recovery in domestic demand as producer price deflation worsened.
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Oil futures jumped by a dollar on Monday as a potential hurricane system approached the U.S. Gulf Coast, and markets recovered from a selloff following weaker-than-expected U.S. jobs data on Friday.
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Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil.
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The October front-month rubber contract on Singapore Exchange’s SICOM platform STFc1 last traded at 183.9 U.S. cents per kg, up 1.6%.
($1 = 142.9000 yen)
($1 = 7.1085 yuan)
Reporting by Gabrielle Ng; Editing by Subhranshu Sahu and Sherry Jacob-Phillips
