Rubber futures decline amid weaker demand from China

Tokyo – Natural rubber (NR) futures pricing has remained weak over the recent weeks amid subdued demand from major consumer, China.

NR futures closed the trading week ended 19 April with declines across all major Far East markets, reported Japan Exchange Group (JPX) 22 April.

In Osaka, Japan, OSE rubber futures fell 1.5% in light trading activity.

In China, SHFE and INE rubber futures dropped 0.9% and 1.7%, respectively, driven by “long liquidation and profit-taking”, said JPX in its weekly report.

Singapore’s SICOM rubber prices also witnessed a marginal decline due to long liquidation.

According to JPX, open interest decreased across all exchanges "as speculative funds continued to unwind their long positions."

Market sentiment was clouded by uncertainties surrounding supply shortages and weaker demand from China.

However, JPX noted “positive reports” during the week signalling a 'gradual recovery' in the rubber supply situation in Yunnan, China.'

Furthermore, the report said there had been improvement in yields that were  previously affected by by El Nino.

In related stories, Yokohama Rubber Industries broke ground on a 5-million-unit-per-year passenger car tire plant in Saltillo, Mexico, with production is slated to commence in early 2025.

China's Sailun Tire, meanwhile, has delayed production schedule for an expansion project at its facility in Vietnam until March 2025.

In financial news, China reported a GDP growth rate of 5.3% year-on-year for the first quarter, surpassing expectations.