Rubber declined, heading for the first quarterly loss since June, as swelling stockpiles and slowing manufacturing in China signal weakened demand from the world’s largest consumer.
The contract for delivery in September dropped as much as 1.8 percent to 270.1 yen a kilogram ($2,869 a metric ton), the lowest level since March 18. Futures traded at 271.8 yen on the Tokyo Commodity Exchange at 10:20 a.m., extending losses for this quarter to 10 percent after two periods of gains.
China tightened curbs on the property market this month to moderate prices. The nation’s manufacturing expanded at the slowest pace in five months in February and retail-sales growth slipped. Natural-rubber inventories climbed 1.9 percent to 115,991 tons, the highest level in about three years, data from the Shanghai Futures Exchange showed March 22. The bourse will update the data later today.
“Stockpiles in China may expand further as demand failed to pick up,” Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo, said today by phone.
China’s demand for the commodity may be unchanged this year as consumption by the heavy-truck sector slows while tire output for passenger vehicles climbs, according to Hangzhou Zhongce Rubber Co. The country represents 34 percent of global rubber demand, according to the International Rubber Study Group.
The contract for September delivery fell 0.3 percent to 22,030 yuan ($3,545) a ton on the Shanghai Futures Exchange. Thai rubber free-on-board lost 0.9 percent to 86.05 baht ($2.93) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
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