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June 11 (Bloomberg) — Rubber climbed for a second day, paring a weekly loss, on optimism that economic expansion in Asia will improve appetite for the commodity used to make tires.
Futures in Tokyo advanced as much as 2.4 percent to the highest level since June 7. The price is headed for a second weekly loss as concerns remain that the sovereign debt crisis may spread from Greece to other European nations.
The ECB yesterday raised its euro-region growth forecast for this year to around 1 percent from 0.8 percent. Asian stocks advanced for the second straight day as investor appetite for riskier assets increased. Japan’s currency retreated against the dollar, raising the appeal of yen-based contracts.
“A pessimistic view on the economic outlook receded after data showed strong growth in Chinese exports and accelerated recovery in Japan’s economy,” Shuji Sugata, research manager at Mitsubishi Corp. Futures Ltd. in Tokyo, said today by phone. “Rubber tracked gains in industrial commodities.”
Rubber for November delivery rose as much as 6.3 yen to 269.3 yen a kilogram ($2,941 a metric ton) before settling at 264.8 yen on the Tokyo Commodity Exchange.
The price has lost 3.3 percent this week, extending a 3.8 percent drop last week. Output in Thailand, the world’s largest producer and exporter, expanded seasonally, leading to a drop in the physical market and capping Tokyo futures, Sugata said.
Cash Rubber
“Increasing supplies from Thailand pressured the upside of the rubber prices,” Navarat Kaewpratarn, senior marketing official at Future Agri Trade Co. said by phone from Bangkok.
The free-on-board price of RSS-3 grade rubber for July delivery dropped 0.4 percent to 113.85 baht ($3.51) a kilogram, the Rubber Institute of Thailand said on its website. It reviews the price daily and issues new data in the afternoon.
September-delivery rubber on the Shanghai Futures Exchange climbed 1.8 percent to settle at 21,825 yuan ($3,195) a ton.
Exports from China jumped 48.5 percent in May from a year earlier, according to data released yesterday, indicating that Europe’s sovereign-debt crisis has yet to restrain the world’s fastest-growing major economy. China is the world’s largest natural rubber consumer, followed by the U.S. and Japan.
Japan’s economy rose at an annualized 5 percent rate in the three months ended March 31, faster than the 4.9 percent reported last month and the biggest gain since the second quarter of 2009, a government report showed today.
Source: Reuters