Shanghai and Tokyo rubber futures rose from the previous week, supported mainly by investors’ confidence on Shanghai Stock Exchange and the improvement of China’s July Purchasing Managers Index (PMI) by HSBC. On physical rubber markets in Asia, natural rubber (NR) prices were steady even though buyers were still on the sidelines as there was scattered rain inSouthern Thailand and a decline of NR supply during the Ramadan holy month in NR producing countries. At the same time, synthetic rubber prices in the region still stayed higher than NR prices mainly due to rising feedstock butadiene cost.
On the end-user front, production of passenger cars in China in the first six months of this year rose by 12.1% year-on-year to about 9.7 million units, according to the China Association of Automobile Manufacturers (CAAM). Likewise, India’s vehicle production rose by 11.6% year-on-year to 1.81 million units in June, said the Society of Indian Automobile Manufacturers (SIAM).
It is expected that lingering geopolitical concerns in the Middle East, tensions between Russia and the West, optimism about the U.S. economic development, stable yen against the dollar, steady NR supply in major producing countries, and positive growth prospect of auto sales in major markets will be major factors that will lend support to NR prices in the coming weeks.
Source: IRCo
