By Aya Takada
Jan. 6 (Bloomberg) -- Natural rubber futures gained for a second day after the yen fell to a one-month low against the dollar and Thailand, the biggest exporter, said it may buy as much as 200,000 metric tons from growers to support prices.
Futures in Tokyo rose as much as 5.8 percent to the highest since Nov. 19 as the weakening currency boosted the appeal of yen-denominated contracts for the commodity traded globally in dollars. The U.S. currency allied on speculation President-elect Barack Obama’s fiscal stimulus will help the economy recover.
“Optimism about Obama’s stimulus plan is improving investor sentiment,” Shuji Sugata, research manager at Mitsubishi Corp. Futures & Securities Ltd. in Tokyo, said today by phone.
Rubber for June delivery, the most-active contract, added 5.1 percent to 152.4 yen a kilogram ($1,637 a ton) on the Tokyo Commodity Exchange at the 11 a.m. local time break.
Futures also advanced on expectation supply from Thailand will decrease, Sugata said. Thailand may buy as much as 200,000 tons from growers and keep it in storage to reduce supply after prices more than halved last year, Somchai Charnnarongkul, director-general of the farm ministry’s Department of Agriculture, said in an interview yesterday.
The agricultural ministry will seek 4 billion baht to fund the price-support plan, Somchai said. The government will provide funds for farmers to store the rubber in warehouses until prices rise to attractive levels, Prime Minister Abhisit Vejjajiva said in an interview on Dec. 17.
Thai Supplies
Thailand may ship 2.6 million tons this year, compared with 2.75 million in 2008, as producers plan to pare production from 3 million tons, according to the Thai Rubber Association.
Rubber futures reached a six-year low of 99.8 yen on Dec. 5, plunging 72 percent from the 28-year high of 356.9 yen June 30 as a global recession cut auto sales and forced carmakers to reduce output, leading to a drop in tire demand.
U.S. auto sales plunged 36 percent in December, dragging the industry’s annual volume to a 16-year low as the recession ravaged demand. General Motors Corp. sold the fewest vehicles in its home market since 1959.
Toyota Motor Corp. and Honda Motor Co. posted their first drop in full-year U.S. sales since the mid-1990s after December declines of at least 35 percent. Chrysler LLC’s 53 percent dive last month paced major automakers, while Ford Motor Co. slumped 32 percent and GM and Nissan Motor Co. fell 31 percent.
“Rubber futures shrugged off the auto figures as the market has already digested a slump in the industry,” Takaki Shigemoto, an analyst at commodity broker Okachi & Co., said today by phone.
May-delivery rubber on the Shanghai Futures Exchange, the most-active contract, surged by the daily price limit to 12,140 yuan ($1,776) a ton at the 11:30 a.m. local time break.
To contact the reporter on this story: Aya Takada in Tokyo at atakada2@bloomberg.net
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