Feb. 2 (Bloomberg) -- Rubber fell for the first time in three days as crude oil traded near a six-week low, reducing the appeal of the commodity as an alternative to synthetic products.
The July-delivery contract dropped as much as 1.9 percent to 310.5 yen a kilogram ($4,078 a metric ton) before trading at 311 yen on the Tokyo Commodity Exchange at 12:44 p.m.
Oil declined to the lowest level since Dec. 21 as U.S. crude stockpiles increased more-than-estimated and gasoline consumption fell to a 10-year low. Rubber was also sold as buying from China, the world’s largest consumer, failed to pick up after the week-long Lunar New Year holiday, said Ken Kajisa, an analyst at broker ACE Koeki Co. in Tokyo.
“Data showing the strength of China’s economy eased speculation that the nation will ease monetary policy to support growth, leading to sales of futures,” he said by phone. “Lower oil is another drag on the price of rubber.”
China’s manufacturing expanded last month on increased new orders, suggesting the economy is withstanding Europe’s debt crisis and a government-induced property slowdown at home. The manufacturing report cuts the need for “aggressive” policy easing, according to Fan Cheuk Wan, head of Asia-Pacific research at Credit Suisse Private Banking.
The Thai cash price gained 0.7 percent to 126.30 baht ($4.09) a kilogram yesterday, the Rubber Research Institute of Thailand said on its website. Rains in southern Thailand persist, while rubber plantations in the nation’s north and northeast are entering lean production season, it said.
May-delivery rubber in Shanghai dropped 0.6 percent to 27,110 yuan ($4,304) a ton at 11:02 a.m. local time.
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