Rubber futures pressured as supply returns to normal

Tokyo – Natural rubber (NR) pricing continued a weak run in the final trading week of April as all major Far East markets posted week-on-week declines.

Over the week ended 26 April, Japan’s OSE rubber futures fell 1.2% compared to the week before, while China’s SHFE and INE rubber futures dropped 3.4% and 3.7%, respectively.

In Singapore, SICOM rubber futures declined 2.6% week-on-week, according to data published 29 April by the Japan Exchange Group (JPX).

Open interest in both the SHFE and INE markets fell significantly, with decreases of 35,719 lots (357,000 tonnes) and 25,613 lots (256,000 tonnes) respectively, JPX noted.

This contrasts with the highs reached at the end of March 2024, when speculative funds drove rubber prices to recent peaks, according to the weekly review.

“Long liquidation” from funds and speculators are being driven by concerns about market uncertainty and weaker demand from China.

These factors have dampened prices and open interest across NR markets, according to the commodity market watcher.

JPX went on to suggest that weak physical demand, coupled with increased supply at the end of the wintering season, could put further pressure on prices.