Rubber at Five-Month High on Second Greek Bailout, Oil’s Rally

Rubber at Five-Month High on Second Greek Bailout, Oil’s Rally

Rubber climbed to a five-month high
as Euro-area finance ministers agreed on a second bailout for
Greece, increasing optimism demand for the commodity will expand.
The July-delivery contract gained for a third day by 0.5
percent to settle at 328.4 yen a kilogram ($4,117 a metric ton),
the highest settlement level since Sept. 22, on the Tokyo
Commodity Exchange. Futures have jumped 25 percent this year.
Oil traded near the highest price in nine months on
speculation fuel demand will increase after euro-area finance
ministers agreed on the bailout. The deal includes a 53.5
percent writedown for investors in Greek bonds, said
Luxembourg’s Jean-Claude Juncker, who led the meeting.
“The bailout of Greece raised optimism that demand for
rubber will continue to grow,” said Chaiwat Muenmee, an analyst
at Bangkok-based commodity broker DS Futures Co. Higher oil
prices were supportive, he said.
Futures were also supported by a seasonal decline in
supplies as Thailand, the largest producer and exporter, entered
a low-production period, Takaki Shigemoto, an analyst at
research company JSC Corp. in Tokyo, said today by phone.
Rains spread across 60 percent of Thailand’s southern
provinces, disrupting latex tapping, according to the Rubber
Research Institute of Thailand. The cash price was unchanged at
125.85 baht ($4.09) a kilogram today, the institute said.
“Supply tightness will continue as major producing
countries are fully entering the low production period this
month,” International Rubber Consortium Ltd., a producer group
representing Thailand, Indonesia and Malaysia, the top three
growers, said on its website.
May-delivery rubber on the Shanghai Futures Exchange closed
2.4 percent higher to 28,910 yuan ($4,590) a ton. Natural-rubber
inventories fell 228 tons to 31,636 tons, based on a survey of
nine warehouses in Shanghai, Shandong, Yunnan, Hainan and
Tianjin, the bourse said on Feb. 17.