May-delivery rubber on the Tokyo Commodity Exchange advanced 0.4 percent to settle at 381.9 yen per kilogram ($4,563 a metric ton) after climbing to 383 yen, matching a 30-year high reached on Nov. 11. The contract advanced 3.1 percent this week.
Cash rubber prices climbed to a record after heavy rain and flooding reduced output in Thailand and other Asian producers, according to the Rubber Research Institute of Thailand. The price will likely extend gains as latex production in the country starts a seasonal decline as early as next month, said Hisaaki Tasaka, an analyst at Tokyo-based broker ACE Koeki Co.
“The market is fundamentally bullish as shipments from Thailand will decline further,” he said by phone today.
Cash rubber was at 137.05 baht ($4.56) per kilogram yesterday, matching a record reached on Dec. 8, the Rubber Research Institute of Thailand said on its website. The Thai market is closed for holiday today.
Gains in futures were limited amid concern that China may end tax incentives for cars, weakening demand for the commodity used in tires, and as the nation may raise interest rates to curb inflation, Tasaka said.
China, the world’s biggest car market, may end tax incentives for buying passenger cars next year, said Xiong Chuanlin, vice secretary-general of the China Automobile Industry Association. Passenger-car deliveries to dealers rose to a monthly record in November.
China Car Sales
The Chinese government cut a 10 percent tax on car sales to 5 percent in 2009 and then raised the rate to 7.5 percent this year. The policy, along with subsidies for car sales in rural areas and incentives to trade-in older models, will expire at the end of this month.
Sales of passenger cars including multipurpose and sport- utility vehicles increased 29.3 percent to 1.34 million last month, higher than the previous record of 1.32 million in January, according to the China Association of Automobile Manufacturers. The pace of growth was the fastest since April.
May-delivery rubber in Shanghai closed up 2.1 percent at 33,805 yuan ($5,081) a ton. It climbed to a record 38,920 yuan Nov. 11.
Speculation grew that the Chinese central bank will increase rates this weekend as the statistics bureau brought forward the release of November economic data on inflation, retail sales, industrial output and fixed-asset investments by two days to Dec. 11.
China’s central bank last month ordered banks to set aside larger reserves for the second time in two weeks after raising interest rates in October for the first time since 2007.
China will shift to a “prudent” monetary policy next year from a “moderately loose” stance as the government seeks to combat accelerating inflation, it said.
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