This entry was posted on Thursday, September 3rd, 2009 at 8:50 am and is filed under Rubber News. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.
Sept. 2 (Bloomberg) — Rubber dropped by as much as 3.8 percent as a sell-off in global equities raised concern that the economic recovery may falter, curbing demand for the material.
Futures in Tokyo declined to the lowest since Aug. 24 as Asian stocks fell after the Standard & Poor’s 500 Index dropped for a third day on concern U.S. banks will post more losses.
“Concern about the health of the U.S. economy and the financial system resurfaced, triggering sales of risk assets,” Hisaaki Tasaka, analyst at Tokyo-based commodity broker ACE Koeki Co., said today by phone.
February-delivery rubber lost as much as 7.8 yen to 196.7 yen a kilogram ($2,117 a metric ton) before settling at 199.5 yen on the Tokyo Commodity Exchange.
The MSCI Asia Pacific Index dropped 1.5 percent to 112.26 as of 3:44 p.m. in Tokyo. The S&P 500 Index slid 2.2 percent yesterday, the most since Aug. 17. The KBW Bank Index of 24 U.S. financial companies fell 5.8 percent as analysts at RBC Capital Markets said U.S. banks on the West Coast still face credit deterioration and higher loan losses.
Rubber futures gained 3.9 percent last month, extending a 21 percent increase in July, the best performance since December 2006, as demand from tiremakers recovered on rising car sales.
Rubber prices are expected to climb as much as 19 percent by the end of next year as rising vehicle sales in China increase demand, said Tokyo-based Marubeni Corp., the largest Japanese trader of the commodity.
The cash price will probably trade between $1.80 and $2.30 a kilogram in the six months starting Jan. 1 and range from $2 to $2.50 in the second half, said Roka Komiya, a trader at the rubber section of Marubeni. The commodity currently trades at $2.10 a kilogram, and may retreat to as low as $1.50 later in 2009 before recovering, he said in an interview yesterday.
Clunkers Program
Toyota Motor Corp., Honda Motor Co. and Hyundai Motor Co., buoyed by the U.S. government’s “cash for clunkers” rebates, had their highest monthly sales this year in August and led Asian brands to their first combined sales gain in 15 months.
Under the clunkers program that ran from July 27 through Aug. 24, buyers of new, more fuel-efficient autos were eligible for as much as $4,500 for trade-ins of older models. The pace of sales in September may fall with the end of the federal Car Allowance Rebate System, according to industry analysts.
January-delivery rubber on the Shanghai Futures Exchange lost as much as 4 percent to 17,330 yuan ($2,554) a ton before settling at 17,490 yuan.
Prices dropped for a third day after stockpiles monitored by the exchange increased to the highest level since March 2008, raising concern demand in China, the world’s largest consumer, may be slowing.
Rubber inventories increased 7,577 tons to 82,517 tons, based on a survey of 10 warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin, the exchange said Aug. 28.
Source: Bloomberg