Rubber prices shed more than 1% in late trading today, Friday (8/6/2018), amid concerns over rising supply from Thailand.
The price of rubber for delivery in November 2018, the most active contract on the Tokyo Commodity Exchange (Tocom), closed down 1.90% or 3.60 points at 186.10 yen per kilogram (kg).
This morning the main commodity price of tire manufacturing was opened flat at 189.70, after ending up 0.85% or 1.60 points on trading Thursday (7/6/2018).
According to Hideshi Matsunaga, Sunward Trading analyst, as rubber supply from Thailand increased after a low production season ended last month, the amount of rubber stocks could continue to rise.
The amount of rubber stocks monitored by the Shanghai Futures Exchange reported rose 0.3% to 475,132 tons last week, the highest level since November.
"Rubber prices are also limited concerns that a trade tension with the United States could push the Japanese currency against the US dollar, thus making rubber [Tocom] prices more expensive for foreign investors," Matsunaga added.
The yen continued to appreciate 0.15 percent, or 0.16 points, to 109.54 per dollar at 13:52 pm, after ending up 0.44 percent or 0.48 points at 109.70 late Thursday / 6).
Quoted by Bloomberg, the yen extended its gains amid global trade tensions ahead of the G7 Summit and concerns over growing instability in some emerging market currencies.
As is known, the strengthening of the Japanese yen exchange rate against the US dollar makes the price of commodities traded in this currency to be relatively more expensive for overseas buyers. As a result, demand for these commodities has the potential to decline.
In line with rubber, West Texas Intermediate (WTI) oil prices for July delivery in July 2018 slid and fell 0.49% or 0.32 points to settle at $ 65.63 a barrel on the New York Mercantile Exchange at 13:41 pm.
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