Japanese rubber futures down on stronger yen

The Osaka Exchange (OSE) rubber contract for July delivery declined 4.9 yen, or 1.4 percent, to 345 yen (USD2.26) per kg. The rubber contract on the Shanghai Futures Exchange (SHFE) for May delivery rose 200 yuan, or 1.24 percent, to 16,360 yuan (USD2,355.58) per metric ton.

The most-active March butadiene rubber contract on the SHFE rose 15 yuan, or 0.11percent, to 13,265 yuan per ton. The yen hit a two-and-a-half-month high against the dollar after the New York Federal Reserve conducted rate checks on dollar/yen on Friday at the behest of Tokyo, seen as a precursor to official intervention.

A stronger Japanese currency makes yen-denominated assets less affordable to overseas buyers.

Meanwhile, rubber trees in northern Thailand have begun shedding leaves, a sign that the tapping season is coming to an end, Chinese broker CITIC Securities Futures said in a report. In addition, production from rubber trees in Vietnam and the Ivory Coast has also started tapering, CITIC Securities Futures said.

Rubber crops usually undergo a season of low production from February to May, before entering a peak harvesting period that lasts until September. Tapping is expected to gradually cease by the end of this month, and rubber-processing plants are gradually entering the stockpiling and storage phase, CITIC Securities Futures said.

The front-month rubber contract on Singapore Exchange’s SICOM platform for February delivery last traded at 188.8 US cents per kg, up 0.7 percent as of 0700 GMT.