Rubber futures prices ease back as markets realign

Tokyo – World rubber futures markets saw a general easing of prices over the trading week to 20 Oct, reflecting “pressures of long liquidation and selling by commodity funds,” Japan Exchange Group (JPX) has reported.

In Osaka however, rubber futures increased by 1.1% week-on-week on Japan’s OSE exchange, according to JPX, noting that the uptick was driven mainly by ‘short-covering’,

“Notably, the [OSE] front Oct-2023 contract experienced a significant surge due to limited market liquidity and challenges in obtaining physical rubber for delivery,” added the report issued 23 Oct.

On China’s SHFE and INE commodity exchanges, rubber futures prices decreased by 1.1% and 2.1% respectively, as “fund managers actively engaged in long liquidation following a recent rally,” noted the weekly review.

In Singapore, meanwhile, JPX linked a 3.0% decline in SICOM rubber futures “primarily attributed to long liquidation and selling by rubber producers.”

Overall, JPX said rubber futures prices had “retraced from a technically overbought condition, and this adjustment aligns with a decrease in open interest across all exchanges.”

Reviewing related developments, JPX said rubber futures could be boosted by the impact of heavy rains on supply in major producing countries such as Thailand, Malaysia, and Vietnam.

Also likely to support prices, it said, was a 10.7% increase in China's total vehicle sales at the end of September, and a higher-than-expected 4.9% rise in China's third quarter GDP.

Selected NR futures price trends on major trading exchanges