Rubber declined for a fifth day on Monday and traded near a two-month low as stockpiles increased in China, the largest consumer, and a survey showed the country’s manufacturing may expand this month at a slower rate.
The contract for July delivery on the Tokyo Commodity Exchange fell as much as 0.8% to 294.6 yen a kilogramme (US$3,132 a metric tonne), approaching the two-month low of 292.7 reached Feb 21, and was at 295.9 yen at 10.52am. Futures have declined 2.2% this year.
The preliminary reading of a Purchasing Managers’ Index was 50.4 in February, according to a statement from HSBC Holdings Plc and Markit Economics today. That compares with the 52.3 final reading for January and the 52.2 median estimate of 11 analysts surveyed by Bloomberg News. A number above 50 indicates expansion. Inventories monitored by the Shanghai Futures Exchange rose 2,401 tonnes to 102,416 tonnes, the bourse said Feb 22. It was the highest level since March 2010.
"The data strengthened concerns that China's demand is not strong enough to absorb ample supply from Southeast Asian producers," Takaki Shigemoto, an analyst at research company JSC Corp in Tokyo, said on Monday by phone.
The contract for September delivery on the SHFE lost 1.3% to 24,720 yuan ($3,965) a tonne. Thai rubber free-on-board declined 0.5% to 91.20 baht ($3.05) a kilogramme on Feb 22, according to the Rubber Research Institute of Thailand.
