Rubber futures under pressure amid weak global economy

Tokyo – Rubber futures came under further pressure over the trading week ended 26 Aug, as major markets remained on a downward track throughout this month.

“Due to speculative selling and 'long liquidation', prices continued to slide to the new recent lows,” said Japanese JPX exchange in its weekly market report 29 Aug.

The prospect of further interest rate hikes, a weaker Chinese economy and fear of a global recession kept buyers away from the market, it added.

In Osaka, while near-month prices increased due to firmer physical demand for RSS3, rubber futures closed marginally lower compared to the week before.

In China, SHFE and INE's futures fell 1.3% and 1.6%, respectively, while Singapore’s SICOM futures pricing fell back by 1.4%.

On a different note, JPX said a sharp fall in trading volumes across all exchanges signaled that "selling pressure was in the last phase."

In addition, JPX noted that the onset of Indonesia's wintering season next month could reduce supplies of natural rubber reaching the market.