Japanese rubber futures rose after a four day losing streak, as stabilizing prices and persistent rains in top producing regions supported sentiment. The Osaka Exchange (XOSE) rubber contract for February delivery gained 0.54%, to ¥318 per kilogram, reflecting renewed buying interest after last week’s unwinding of speculative positions.
The rebound comes amid warnings from Thailand’s meteorological agency of heavy rainfall and flash flood risks between September 17/19, which could disrupt supply chains and elevate prices. Market estimates suggest nearly 60% of futures positions accumulated in the prior week were liquidated, adding to recent volatility.
In China, the Shanghai Futures Exchange (XSHG) rubber contract for January delivery rose 1.07% to ¥16,040 yuan per metric ton, while the October butadiene rubber contract climbed 0.73% to ¥11,675 yuan. Despite the uptick, China’s auto sector remains under pressure, with the government targeting 32.3 million vehicle sales in 2025, slightly below industry projections. Fierce price competition continues to weigh on rubber tyre margins.
Currency movements also played a role, with the yen weakening 0.3% to 146.975 per dollar, making yen denominated assets more attractive to overseas buyers. Meanwhile, oil prices edged higher as investors assessed potential supply disruptions from Russia following drone attacks on refineries. This is particularly relevant for rubber markets, as natural rubber competes with synthetic rubber, which is derived from crude oil. On the Singapore Exchange (XSIN), the front month September contract last traded at 174.3 U.S. cents per kilogram, up 0.1%, signaling cautious optimism across the sector.