Rubber had the first quarterly loss since 2008 on concern the global economic recovery may falter, weakening demand for the commodity used in tires.

Futures in Tokyo tumbled for a third day to the lowest level in more than two weeks, after data showed an unexpected drop in U.S. consumer confidence and the downward revision of a leading economic indicator for China. The price dropped 13 percent this quarter, the first loss since the three months ended Dec. 31, 2008.

Asian stocks extended a global rout, dropping to a three- week low. The Conference Board’s gauge of confidence among U.S. consumers slumped to 52.9 this month from a revised 62.7 in May. The nation is the biggest consumer of natural rubber after China.

“The market came under pressure amid concern that the global economy may slow down as governments, struggling to reduce fiscal deficits, cannot continue stimulus measures,” Hisaaki Tasaka, analyst at Tokyo-based broker ACE Koeki Co., said today by phone. “Rubber may drop further together with other industrial commodities.”

December-delivery rubber fell as much as 2.9 percent to 266.5 yen ($3,011 a metric ton) on the Tokyo Commodity Exchange before settling at 269.2 yen.

The Conference Board said yesterday its leading economic index for China climbed more slowly in April than previously estimated. The board’s U.S. confidence index in June was lower than all forecasts in a Bloomberg News survey.

Thai Output

Rubber futures advanced yesterday to 285.2 yen, the highest level since May 28, as rain disrupted output in Thailand, the biggest producer and exporter.

“The downside is limited as Japan and China have low inventories,” said Felix Yeo, trading manager at the Singapore unit of Marubeni Corp. “Raw materials are still tight and that will easily push up the market again.”

Stockpiles in China declined to the lowest level in seven years, data showed last week, sparking optimism that the world’s biggest buyer may soon replenish inventories.

Natural rubber stockpiles monitored by the Shanghai Futures Exchange dropped 1,670 tons to 14,771 tons, the bourse said on June 25. That was the lowest level since January 2003, according to Bloomberg data.

China, the largest auto market, is the biggest consumer of natural rubber. The nation may increase gross imports of the raw material to 1.68 million tons this year, from 1.59 million in 2009, according to a May report from the Association of Natural Rubber Producing Countries.

November-delivery rubber on the Shanghai Futures Exchange lost as much as 1.9 percent to 21,175 yuan ($3,119) a ton and closed at 21,585.

Cash prices in Thailand extended losses as Chinese buyers have delayed purchases, according to the Rubber Institute of Thailand. The Thai benchmark price plunged 2.1 percent today to 115.60 baht ($3.57) a kilogram, it said.

Source: Bloomberg

Rubber retreated from a one-month high as crude oil declined amid concern that slower economic growth may curb demand, cutting the appeal of the commodity as an alternative to synthetic products.

Rubber for December delivery lost 3.3 percent to settle at 274.4 yen ($3,094 a metric ton) on the Tokyo Commodity Exchange, the lowest level in a week. The price climbed yesterday to the highest level since May 28, as rainfall disrupted output in Thailand, the biggest producer and exporter.

Crude oil declined 2.2 percent at 3:51 p.m. in Singapore on skepticism that production in the Gulf of Mexico will be disrupted by a tropical storm in the region. U.S. forecasters projected that Tropical Storm Alex will move across the southern Gulf and make landfall as a hurricane July 1 in Mexico.

“A drop in oil was the largest drag on the price of rubber,” Shuji Sugata, research manager at Mitsubishi Corp. Futures Ltd. in Tokyo, said today by phone. “An unclear outlook for global economies also sapped investor appetite for industrial commodities.”

“A stronger Japanese yen and worries over cooling global economic expansion have had a negative psychological effect on the rubber market,” said Varut Rungkhum, analyst at Bangkok- based commodity broker Agro Wealth Ltd.

The yen rose to a seven-week high against the dollar as signs the global economic recovery is slowing boosted demand for Japan’s currency as a refuge. Japan’s currency rose to 88.63 against the dollar, compared with 89.37 yen yesterday.

China Stockpiles

Stockpiles in China declined to the lowest level in seven years, sparking optimism that the world’s biggest buyer may soon replenish inventories, data showed. Natural rubber stockpiles monitored by the Shanghai Futures Exchange dropped 1,670 tons to 14,771 tons, the bourse said on June 25. It was the lowest level since January 2003, according to Bloomberg data.

China, the largest auto market, is the biggest consumer of natural rubber. The nation may increase gross imports of the raw material to 1.68 million tons this year, from 1.59 million in 2009, according to a May report from the Association of Natural Rubber Producing Countries.

November-delivery rubber on the Shanghai Futures Exchange lost 2.4 percent to settle at 21,735 yuan ($3,198) a ton.

Cash prices in Thailand declined as Chinese buyers have shifted to purchasing cheaper rubber from Indonesia, the Rubber Institute of Thailand said on its website today. The Thai benchmark price dropped 0.6 percent today to 118.10 baht ($3.67) a kilogram, it said.

Source: Bloomberg

Rubber advanced to a one-month high after data showed stockpiles in China declined to the lowest level in seven years, sparking optimism the biggest buyer may soon replenish inventories.

Futures in Tokyo climbed to 288.6 yen per kilogram ($3,231 a metric ton), matching a high reached on May 28. The price gained 3.8 percent last week, booking the second weekly increase, as rainfall disrupted production in Thailand, the world’s biggest producer and exporter.

Natural rubber stockpiles monitored by the Shanghai Futures Exchange dropped 1,670 tons to 14,771 tons, the bourse said on June 25. It was the lowest level since January 2003, according to the Bloomberg data.

“Chinese buyers may have withheld rubber purchases amid speculation that the raw material prices would drop on a seasonal increase in production,” Kazuhiko Saito, an analyst at commodity broker Fujitomi Co. in Tokyo, said today by phone. “As rubber prices have stayed high,” they may step up buying to replenish inventories, he said.

Rubber for December delivery settled at 283.80 yen from its settlement of 278.6 yen on June 25. It has become the most- actively traded contract on the Tokyo Commodity Exchange after its listing on June 25.

November-delivery rubber on the Shanghai Futures Exchange added 1.7 percent to settle at 22,265 yuan ($3,278) a ton. Earlier, it rose to 22,420 yuan, the highest level since June 2.

China Demand

China, the largest auto market, is the biggest consumer of natural rubber. The nation may increase gross imports of the raw material to 1.68 million tons this year, from 1.59 million in 2009, according to a May report from the Association of Natural Rubber Producing Countries.

In Thailand, “heavy rains in southern provinces have reduced tapping, supporting prices,” said Chaiwat Muenmee, an analyst at Bangkok-based commodity broker DS Futures Co.

The auctioned price of ribbed smoked sheet gained 0.6 percent to 111.91 baht ($3.46) a kilogram as supply is limited, the Rubber Institute of Thailand said on its website today.

The benchmark price in Thailand remained unchanged at 118.85 baht ($3.67) a kilogram, according to the institute. A decline in rainfalls in southern Thailand will increase the latex volume, it said.

Rubber prices may climb 26 percent next year as supplies lag behind demand, according to Royal Bank of Scotland Asia Securities (Singapore) Pte.

Rubber may average $4,500 a ton next year, up from $3,580 a ton year-to-date, as “heavy rainfall in southern Thailand has disrupted supply” and “inventory levels in China are worse than we expected,” Nirgunan Tiruchelvam, a commodities analyst at the bank, said in an e-mailed report last week.

Source: Bloomberg

Rubber climbed for a second day to one-week high on optimism that Japan and China will soon build up stockpiles amid concerns that rainfall in southern Thailand will further cut scarce supplies from the largest exporter.

Futures in Tokyo advanced as much as 3 percent to 286.2 yen per kilogram ($3,185 a metric ton), the highest level since June 16, headed for a second weekly gain on optimism that the European debt crisis may not substantially weaken demand for the commodity used to make tires and gloves.

“Tokyo doesn’t have many stocks in the warehouse, neither does Shanghai,” said Kazunori Kokubo, a manager at Yutaka Shoji Ltd. Speculation that the two countries will soon accumulate rubber is helping to drive gains, he said.

Crude rubber stockpiles held at Japanese warehouses fell 12.1 percent to 3,563 metric tons on June 10, according to data released today from the Rubber Trade Association of Japan.

China’s natural rubber inventories fell 1,440 tons to 16,441 tons, based on a survey of 10 warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin, the Shanghai Futures Exchange said June 18. It’s the lowest level since 2003, according to data compiled by Bloomberg.

Rubber for November-delivery gained 1.1 percent to settle at 280.9 yen per kilogram on the Tokyo Commodity Exchange. The November-delivery contract on the Shanghai Futures Exchange rose 1.3 percent to settle at 21,820 yuan ($3,202) a ton.

China, the world’s largest auto market, is the biggest user of natural rubber. The nation may increase gross imports of the raw material to 1.68 million tons this year, from 1.59 million in 2009, according to a May report from the Association of Natural Rubber Producing Countries.

Thai Supplies

The monsoon covering the Andaman Sea and the Gulf of Thailand is causing heavy rains in many parts of the country, including southern provinces, the Meteorological Department said on its website today. Thailand’s southern provinces account for 68 percent of the nation’s total rubber plantation area.

“Heavy rains sparked worries that the currently low level of supplies will subside further,” Varut Rungkhum, analyst at commodity broker Agro Wealth Ltd., said by phone from Bangkok.

“The nearby contract rally reflected a tight supply in the physical market. Its gains spilled over to other contracts,” Varut said.

The contract for June delivery, which expired today, gained as much as 2.5 percent to 372.90 yen per kilogram before settling at 372 yen.

The benchmark price in Thailand advanced 0.9 percent to 117.35 baht ($3.62) a kilo as demand remains strong and rainfall limits tapping, reducing latex production, the Rubber Institute of Thailand said on its website today.

Global rubber output may total 9.7 million to 10.2 million tons this year as drought and heavy rainfall in key producing countries including Thailand and Indonesia damage supply, Stephen Evans, the secretary-general of the International Rubber Study Group, said in an interview last week. That compares with the group’s forecast range of 10.1 million to 10.6 million tons on March 17.

Demand will probably increase by 4.4 percent this year to 9.8 million tons, based on the assumption that the economic recovery will slow, Evans said. The group forecast in March that demand would be 10.2 million tons.

Source: Bloomberg

Rubber advanced for a second time in three days on expectations of Chinese buying as stockpiles fall and supplies from Thailand, the largest grower, increase at a slower pace than estimated.

Futures in Tokyo climbed as much as 0.5 percent to 279.1 yen per kilogram ($3,087 a metric ton) after falling 1.4 percent earlier today. The most-active contract is heading for a second weekly gain amid optimism that Europe’s sovereign-debt crisis may not substantially weaken demand for the commodity used to make tires and gloves.

“Heavy rainfall in southern Thailand has sparked worries that supplies may not be as much as expected,” Varut Rungkhum, analyst at commodity broker Agro Wealth Ltd., said by phone from Bangkok. “Low stockpiles in China also boosted optimism the biggest buyers will soon start building inventories.”

Rubber for November-delivery settled at 277.9 yen per kilogram, adding 0.1 percent from yesterday, on the Tokyo Commodity Exchange.

The November-delivery contract on the Shanghai Futures Exchange gained 0.1 percent to settle at 21,520 yuan ($3,161) a ton.

“Low level of rubber stocks in Japan and Shanghai” supported the market gains, said Hiroyuki Kikukawa, general manager of research at Tokyo-based IDO Securities Co.

China’s natural rubber inventories fell 1,440 tons to 16,441 tons, based on a survey of 10 warehouses in Shanghai, Shandong, Yunnan, Hainan and Tianjin, the Shanghai Futures Exchange said June 18. It is the lowest level since 2003, according to data compiled by Bloomberg.

China Imports

China, the world’s largest auto market, is the biggest user of natural rubber. The nation may increase gross imports of the raw material to 1.68 million tons this year, from 1.59 million in 2009, according to a May report from the Association of Natural Rubber Producing Countries.

Rains are spreading in southern Thailand, with heavy rains in some province, the Meteorological Department said on its website today. Thailand’s southern provinces represent 68 percent of total rubber plantation area.

“Nearby contracts will probably stabilize as production from Thailand will increasingly come onto the market,” Katsumi Kinoshita, senior manager for Institutional Department, Orion Koeki Co. Ltd., said by phone from Kobe.

Rubber for June-delivery gained as much as 2.8 percent to settle at 364 yen per kilogram.

Global rubber output may total 9.7 million to 10.2 million tons this year as drought and heavy rainfall in key producing countries including Thailand and Indonesia damage supply, Stephen Evans, the secretary-general of the International Rubber Study Group, said in an interview last week. That compares with the group’s forecast range of 10.1 million to 10.6 million tons on March 17.

Demand will probably increase by 4.4 percent this year to 9.8 million tons, based on the assumption that the economic recovery will slow, Evans said. The group forecast 10.2 million tons in March.

Source: Bloomberg