Rubber climbs as China’s output growth raises demand outlook

Rubber increased for the first time in five days after data showed faster-than-estimated growth in China’s industrial output, boosting optimism demand will expand from the world’s largest consumer. Futures in Tokyo rallied as much as 0.9 per cent after declining 3 per cent in the previous four sessions. The price also advanced as a rally in crude oil raised the appeal of natural rubber as an alternative to synthetic products.

Industrial production in China gained 13.9 per cent in August from a year earlier, more than the 13 per cent median estimate of 29 economists surveyed by Bloomberg, the statistics bureau said on September 11. The country’s retail sales gained 18.4 per cent in August, compared with 17.9 per cent in July. February-delivery rubber rose as much as ¥2.6 to ¥295.6 per kilogram ($3,513 a metric tonne) before trading at ¥294.4 on the Tokyo Commodity Exchange at 11:06 am. March-delivery rubber on the Shanghai Futures Exchange gained 1.3 per cent to 25,585 yuan ($3,782) a tonne. The price recovered from a two-week low reached on Sept. 10 amid speculation that Chinese regulators were investigating natural rubber positions.