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July 13 (Bloomberg) — Natural rubber futures in Tokyo fell as the yen advanced against the dollar and crude oil dropped for a second day, reducing demand prospects for the commodity.
The yen gained for a second day against the dollar, reducing the value of the Japanese currency-based commodity, used to make tires. Crude oil fell as much as 1.6 percent, cutting the cost of making the rival synthetic rubber.
“The yen’s strength dragged rubber futures as well as other commodities in Tokyo lower,” Takaki Shigemoto, an analyst at broker Okachi & Co, said by phone from Tokyo. The decline in crude oil prices and speculation that rubber supplies from Thailand may increase added downward pressure, he said.
Rubber for December declined as much as 5.8 yen, or 3.7 percent, to 152.2 yen a kilogram ($1,651 a ton), the lowest intraday level since June 25, on the Tokyo Commodity Exchange and closed at 153 yen.
The dollar fell 0.3 percent to 92.24 yen by 3:31 p.m. Tokyo time after declining 0.5 percent on July 10. Crude oil slumped as low as $58.88 a barrel before trading at $59.27. On July 10, oil dropped as much as 2.8 percent to $58.72 before settling at $59.89.
Output from Thailand, the world’s top exporter, typically rises at this time of year with the end of the so-called wintering season when trees produce less latex, Shigemoto said.
Rubber climbed 0.2 percent last week after China’s passenger-vehicle sales surged in June, according to data from the China Association of Automobile Manufacturers. The price has gained 12 percent this year, after slumping 56 percent in 2008 amid the global recession.
China’s sales of cars, sport-utility vehicles and other passenger vehicles surged 48 percent to 872,900 last month, the association said on July 9. That helped to make the Asian nation the world’s largest auto market this year, with 27 percent more first-half sales than the U.S.
Rubber for November delivery on the Shanghai Futures Exchange, the most-active contract, lost 0.9 percent to 15,370 yuan ($2,249) a ton.
Source: Bloomberg