Japan rubber futures drop on yen strength
SINGAPORE: Japanese rubber futures shed early gains to trade lower on Tuesday, pressured by a firmer yen and the prospect for higher supply.
The Osaka Exchange (OSE) September rubber contract closed down 6.5 yen, or 2.23%, at 285.3 yen ($2.03) per kg.
The September rubber contract on the Shanghai Futures Exchange (SHFE) eased 125 yuan, or 0.85%, to 14,535 yuan ($1,988.34) per metric ton.
The most active May butadiene rubber contract on the SHFE edged 30 yuan lower, or 0.27%, to 10,940 yuan ($1,496.56) per metric ton.
The dollar sank as much as 0.6% to a fresh seven-month low versus the safe-haven yen on Tuesday.
A stronger currency makes yen-denominated assets less affordable to overseas buyers.
On the supply-side, both domestic and overseas production areas are transiting to a harvesting period, and it will take time to see the increase in supply, said Chinese commodities data provider Longzhong Information.
Rubber crops usually undergo a season of low production from February to May, before a peak harvesting period that lasts until September.
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