Rubber prices fall for five consecutive days on daily chart, with weakening demand competing against oil price support

⑴ Japanese rubber futures fell for the fifth consecutive trading day on Tuesday, dragged down by weakening tire demand in China and a technical pullback after prices failed to break recent highs, though rising oil prices limited the decline. ⑵ The Osaka Exchange February delivery rubber contract fell by 5.9 yen, or about 1.4%, to 420.6 yen per kilogram. ⑶ The Shanghai Futures Exchange January delivery rubber contract fell by 330 yuan, or about 1.7%, to 18,720 yuan per ton. ⑷ The most active butadiene rubber contract for October delivery on the Shanghai Futures Exchange plunged by 565 yuan, or about 3.7%, to 14,610 yuan per ton. ⑸ A futures institution pointed out in a report that downstream tire companies are operating at lower rates due to squeezed profits, and some companies plan to shut down before China’s National Day and Mid-Autumn Festival holidays, with operating rates expected to decline further next week. ⑹ Another futures institution stated that natural rubber futures failed to break previous highs this week and have entered a short-term technical pullback, while the support from agriculture-related bullish factors is also weakening. ⑺ Rising oil prices limited the fall in rubber, as oil prices rose nearly 2% on Tuesday after an attack on Saudi Arabia’s energy infrastructure halted the east-west pipeline, fueling continued market concerns over supply disruptions and casting a shadow over efforts to ease Gulf shipping risks. ⑻ Natural rubber often follows the direction of oil prices, as it competes with synthetic rubber made from crude oil for market share. ⑼ The latest Singapore Exchange SICOM platform November delivery rubber contract was reported at 233.7 US cents per kilogram, down about 1.4%.