Japanese rubber futures surged on Tuesday, reaching their highest level in more than two weeks, driven by concerns over supply disruptions in major producing regions and boosted by rising oil prices. The Osaka Exchange’s February rubber contract climbed 14.1 yen, or 3.93%, to 373.0 yen ($2.66) per kg as of 0200 GMT, marking its strongest price since September 2.
Weather disturbances, including warnings from Thailand’s meteorological agency about a strong monsoon and a severe tropical storm affecting the Philippines, China, and Vietnam, have added to supply worries. Additionally, Typhoon Yagi, a powerful storm, had recently impacted Vietnam and China’s Hainan province.
In tandem with this, oil prices extended gains due to concerns over U.S. production following Hurricane Francine and expectations of lower U.S. crude stockpiles. As synthetic rubber, made from crude oil, competes with natural rubber, rising oil prices influence rubber markets.
Meanwhile, the yen strengthened during a holiday-thinned Monday, making yen-denominated assets less attractive to foreign buyers. Japan’s Finance Minister Shunichi Suzuki stated that the government is monitoring the yen’s impact on the economy and will act accordingly. The front-month October rubber contract on Singapore’s SICOM platform increased 1.3% to 190.9 U.S. cents per kg.
