SINGAPORE, Oct 22 (Reuters) –
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Japanese rubber futures gained on Tuesday as traders weighed a firmer demand outlook against prospects of easing supply pressures, while a weaker yen also lent support to prices.
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The March Osaka Exchange (OSE) rubber contract JRUc6, 0#2JRU: closed up 2.1 yen, or 0.54%, at 391.1 yen ($2.59) per kg.
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The January rubber contract on the Shanghai Futures Exchange (SHFE) SNRv1 rose 315 yuan, or 1.74%, to finish at 18,380 yuan ($2,580.95) per metric ton.
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While rubber tapping disrupted by Typhoon Yagi has resumed, downstream tyre factory operations are stable and improving, with capacity utilisation up significantly after the Golden Week holidays, Chinese financial site Guohai Liangshi Futures said in a note.
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With the softening of overseas raw material prices and the negative impact of a delay in a key EU deforestation law, supply-side support has subsided. Rubber prices are now fluctuating while waiting for new drivers, Guohai Liangshi said.
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The yen JPY=EBS touched a near three-month low of 151.10 per dollar. The yield on the benchmark U.S. 10-year Treasury note US10YT=RR rose to its highest since July 26 in Asian hours, weighing on the Japanese currency which is extremely sensitive to moves in Treasuries.
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A weaker Japanese currency makes yen-denominated assets more affordable to overseas buyers. FRX/
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Oil prices eased as the top U.S. diplomat renewed efforts to push for a ceasefire in the Middle East and as slowing demand growth in China, the world’s top oil importer, continued to weigh on the market. O/R
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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 front-month November rubber contract on Singapore Exchange’s SICOM platform STFc1 last traded at 197.6 U.S. cents per kg, up 1.0%.
($1 = 150.7300 yen)
($1 = 7.1214 yuan)
Reporting by Gabrielle Ng; Editing by Subhranshu Sahu
