Rubber declined as data showed China’s manufacturing shrank at a faster pace this month, raising concern that demand from the largest consumer may weaken.
The contract for delivery in November on the Tokyo Commodity Exchange fell as much as 0.8 percent to 235.3 yen a kilogram ($2,434 a metric ton) and was at 235.8 yen at 11:40 a.m. Futures extended losses for this year to 22 percent.
The preliminary reading of 48.3 for a Purchasing Managers’ Index released today by HSBC Holdings Plc and Markit Economics compares with the 49.1 median estimate in a Bloomberg News survey of 15 economists. May’s final reading of 49.2 was the first below 50 since October, indicating a slowdown is deepening in the world’s second-largest economy.
“Concerns about Chinese demand increased, leading to sales of rubber futures,” Takaki Shigemoto, an analyst at research company JSC Corp. in Tokyo, said by phone.
Today’s data adds to evidence that China’s growth is slowing for a second quarter after exports, industrial output and bank lending trailed estimates for May. China consumed 3.85 million tons of natural rubber last year, representing 34 percent of global consumption, according to the International Rubber Study Group.
The contract for September delivery on the Shanghai Futures Exchange lost 2.4 percent to 17,865 yuan ($2,915) a ton. Thai rubber free-on-board gained 1.2 percent to 86.50 baht ($2.80) a kilogram yesterday, according to the Rubber Research Institute of Thailand.
