Rubber gained after data showed car- sales growth in China accelerated, driving futures in Shanghai to the highest in more than two years and raising speculation demand will climb for the commodity used to make tires.

Futures in Tokyo gained for a second day as the Shanghai price jumped to the highest level since July 2008. China, the world’s largest auto market, is also the biggest consumer of natural rubber.

Retail deliveries of cars, sport-utility vehicles and multipurpose vehicles expanded 59 percent last month from a year earlier to 977,300, the China Automotive Technology & Research Center said yesterday. The pace of growth expanded from 15.4 percent in July as incentives by dealers outweighed government measures to cool the economy.

“Rubber in Tokyo chased a rally in Shanghai,” Shuji Sugata, research manager at Mitsubishi Corp. Futures Ltd. in Tokyo, said today by phone. “Market sentiment improved” as the data showed strong Chinese demand, he said.

February-delivery rubber gained as much as 1.2 percent to 300.3 yen a kilogram ($3,569 a metric ton) before settling at 298.8 yen on the Tokyo Commodity Exchange.

January-delivery rubber on the Shanghai Futures Exchange climbed to as high as 26,245 yuan ($3,852) a ton before settling at 26,125 yuan.

China’s passenger-car sales increased even after the nation raised a tax on small cars to 7.5 percent from 5 percent. Growth also quickened in July, from 10.9 percent in June, as dealers increased incentives to clear inventories, according to the Automotive Technology & Research Center, a government researcher.

Chinese Imports

China may boost rubber imports 10 percent this year after “robust demand” from tire makers depleted inventories to the lowest level in more than seven years, an analyst said.

Imports may climb to about 1.87 million metric tons from 1.7 million in 2009, likely supporting prices as shipments from major producers slow, Liu Bin, an analyst at Citic Securities Futures Co., said from Shenzhen today. China’s imports declined 1 percent to 980,000 tons in the first seven months of this year, according to customs data compiled by Bloomberg.

Stockpiles tracked by the Shanghai Futures Exchange declined to 14,771 metric tons on June 24, the lowest level since February 2003 and were at 24,701 tons last week. Combined inventory monitored by the exchange at ports and in industrial warehouses may have dropped to the lowest level in three years, compared with the same time in previous years, Liu said.

In Japan, sales of cars, trucks and buses, excluding minicars, rose 47 percent to 290,789 in August from a year ago, the Japan Automobile Dealers Association said yesterday. It was the biggest increase since December 1972 as car buyers rushed to take advantage of government subsidies set to expire this month.

Source: Bloomberg

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