Rubber in Tokyo advanced by the most since May 2013 as Japan’s currency plunged and as China, the biggest consumer, seeks more than $300 billion in infrastructure investment.
The contract for November delivery on the Tokyo Commodity Exchange surged 6.3 percent to settle at 231.2 yen a kilogram ($1,886 a metric ton), the highest since April 2014. Rubber for September delivery on the Shanghai Futures Exchange rose 3 percent to close at 14,370 yuan ($2,316) a ton.
Japan’s currency fell to the lowest level since 2007 against the dollar, boosting the appeal of contracts denominated in yen. China is seeking nearly 2 trillion yuan ($322 billion) inpublic-private investment, the National Development and Reform Commission announced Monday.
“Optimism about Chinese demand and a weaker yen supported rubber prices,” Gu Jiong, an analyst at commodity broker Yutaka Shoji Co., said by phone from Tokyo.
Inventories tracked by the Shanghai Futures Exchange have dropped 15 percent this year and this month touched the lowest since September 2013, according to bourse data.
Rubber producers accounting for 92 percent of global supply agreed earlier this month to explore ways to strengthen prices, including a common trading platform, according a joint statement by Association of Natural Rubber Producing Countries.
Thailand, the largest supplier, is working on ways to reduce supply to boost prices, including eliminating planting areas in natural forecast by 27 percent over the next two years, Dapong Ratanasuwan, minister of natural resources and environment, said Friday.