Rubber futures fell to a two-week low after data showed stockpiles in biggest-consumer China expanded and shipments from Vietnam jumped, raising speculation supply may grow faster than demand.
The contract for delivery in May on the Tokyo Commodity Exchange declined as much as 2.8 percent to 275 yen a kilogram ($2,635 a metric ton), the lowest level since Dec. 6, and traded at 276 yen at 10:41 a.m. local time. The drop expanded losses this year to 8.8 percent.
Rubber inventory monitored by the Shanghai Futures Exchange grew to 167,141 metric tons by Dec. 19, nearing a nine-year high of 172,022 tons reached on Nov. 21, data from the bourse showed. Exports by Vietnam increased 20 percent to 140,000 tons this month from a year earlier, data from General Statistics Office showed yesterday.
“The market is weighed down by oversupply concerns,” said Kazuhiko Saito, an analyst at broker Fujitomi Co. in Tokyo. “Rising stockpiles in China signal demand from end-users is not strong enough to absorb a global glut.”
Higher volatility in China’s money-market rates and difficulty in obtaining funds among some lenders also raised concerns the world’s second-biggest economy may slow down, curbing demand for raw materials, Saito said.
The seven-day repurchase rate, a gauge of funding availability in the banking system, jumped to 8.84 percent yesterday, the highest level since June 20, according to a daily fixing from the National Interbank Funding Center.
The commodity for May delivery on the Shanghai Futures Exchange lost 0.6 percent to 18,410 yuan($3,033) a ton. Thai rubber free-on-board gained 0.4 percent to 83.65 baht ($2.55) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
Source: Bloomberg
