Japan rubber futures extend rise on Nikkei gain, supply concerns
Japanese rubber futures rose for a second straight session on Thursday, tracking the Nikkei upwards while weather concerns in Thailand softened supply prospects.
The Osaka Exchange (OSE) rubber contract for December delivery ended morning trade 1.7 yen higher, or 0.57%, at 301.5 yen ($2.08) per kg.
The rubber contract on the Shanghai Futures Exchange (SHFE) for September delivery rose 150 yuan, or 1.09%, to 13,900 yuan ($1,940.47) per metric ton as of 0245 GMT.
The most active July butadiene rubber contract on the SHFE increased 45 yuan, or 0.41%, to 11,110 yuan ($1,550.98) per metric ton.
Japan's Nikkei rose 0.9% to a four-month high.
Still, the yen firmed 0.35% to 144.70 per dollar.
A stronger currency makes yen-denominated assets less affordable to overseas buyers.
In top producer Thailand, the country's meteorological agency warned of heavy rains and accumulations from June 24-27.
Oil prices rose slightly, extending gains from the previous session as investors kept an eye on the ceasefire between Israel and Iran.
Japan rubber futures rise on Mideast truce, wet weather concerns
Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil.
In top consumer China, major automaker BYD has slowed production and expansion in recent months, as it wrestles with increasing inventories amid a price war in China's auto market.
Automobile sales could influence the intensity of automobile manufacturing, which involves using rubber-made tyres.
While the production of global natural rubber is expected to increase in 2025, demand growth will likely outpace supply due to ageing trees and shrinking planting space in Southeast Asian production areas, said Chinese broker Dalu Futures.
The front-month rubber contract on Singapore Exchange's SICOM platform for July delivery last traded at 161.4 U.S. cents per kg, up 1.2%.
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