Japan futures sustain 13-year highs on soft supply, stronger demand
SINGAPORE, Aug 29 (Reuters) -
Japanese rubber futures advanced for the eighth consecutive day to 13-year highs on Thursday, driven by tightened global supply from rainfall in production areas and increased demand.
The Osaka Exchange (OSE) rubber contract for February delivery JRUc6, 0#2JRU: was up 2.2 yen, or 0.59%, at 374.0 yen ($2.59) per kg as of 0155 GMT.
The contract hit an intraday high of 375.5 yen, its strongest level since Sep. 1, 2011.
The January rubber contract on the Shanghai Futures Exchange (SHFE) SNRv1 rose 65 yuan, or 0.39%, to 16,740 yuan ($2,347.66) per metric ton.
Rainfall has affected Thai and Yunnan production areas, with floods occurring in many Thai regions, hindering rubber tapping, according to a note from Chinese financial information site Hexun Futures.
Moreover, weather forecasts show it will continue to rain in production areas in the short-term, supporting the strength in the rubber market, added Hexun Futures.
Top rubber producer Thailand's meteorological agency warned of heavy to very heavy rains that may cause flash flood and overflows on Aug. 28 and Sept. 1-3.
The price of Thailand's benchmark export-grade smoked rubber sheet (RSS3) RUB-RSS3C-BKK and block rubber RUB-STR20C-BKK were up 2.64% and 0.84%, to stand at 93.6 baht ($2.75) and 67.57 baht ($1.99), respectively.
With the support of domestic policies to promote automobile consumption, the downstream tire industry has maintained a stable and positive trend, as the production of tires has rebounded, providing demand support for natural rubber, said Chinese commodities data provider Business Community.
Chinese electric vehicle maker BYD 1211.HK002594.SZ reported its fastest net profits growth since end-2023 for the April-June quarter.
Automobile sales could influence the intensity of automobile manufacturing, which involves using rubber-made tyres.
The front-month September rubber contract on Singapore Exchange's SICOM platform STFc1 last traded at 182.3 U.S. cents per kg, up 0.1%.
($1 = 144.6300 yen)
($1 = 7.1305 yuan)
($1 = 34.0200 baht)
Reporting by Gabrielle Ng; Editing by Sumana Nandy
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