Rubber futures gained on Thursday, driven by a surge in oil prices and concerns over potential supply disruptions in Thailand, the world’s leading producer. However, the strength of the yen tempered further gains.
The June Osaka Exchange (OSE) rubber contract increased by 2.7 yen, or 0.7%, closing at 386.5 yen ($2.48) per kilogram. On the Shanghai Futures Exchange (SHFE), the March rubber contract rose 230 yuan, or 1.33%, to finish at 17,485 yuan ($2,384.91) per metric ton. Meanwhile, the February butadiene rubber contract on SHFE saw a notable gain of 355 yuan, or 2.5%, closing at 14,575 yuan ($1,988.00) per metric ton.
Oil prices climbed for the second consecutive session, bolstered by concerns over potential disruptions from U.S. sanctions on Russia, improved demand outlooks, and a decrease in U.S. crude stockpiles. As natural rubber competes with synthetic rubber, which is derived from crude oil, price movements in the oil market often influence rubber prices.
In Thailand, the country’s meteorological agency forecasted an intensification of the northeast monsoon, predicting heavy rains that could disrupt supply. According to Farah Miller, founder of rubber analytics firm Helixtap Technologies, rising prices for Thai raw materials are sustaining rubber prices, as markets await the start of the wintering season.
Meanwhile, the yen remained strong, trading at 155.21 per U.S. dollar, its highest level since December 19, 2024, following speculation of potential interest rate hikes by the Bank of Japan.
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