03 Nov 2008
Natural rubber posted a record monthly loss as slowing economic growth and a production cut by a Japanese carmaker raised concern that demand will fall for the raw material used to make tires.
Futures tumbled 27 percent this month, their biggest such drop on the Tokyo Commodity Exchange, according to Seiki Ichimura, a spokesman for the bourse. Mazda Motor Corp., a third owned by Ford Motor Co., plans to reduce its output in
``The market is overshadowed by demand concerns,'' Takaki Shigemoto, an analyst at Tokyo-based commodity broker Okachi & Co., said today by phone. ``Investor sentiment is vulnerable to negative news from the auto sector.''
Rubber for April delivery lost 3.9 percent to close at 182.5 yen a kilogram ($1,887 a metric ton) on the Tokyo Commodity Exchange. The contract earlier dipped to 174.7 yen, down 8 percent from a one-week high reached yesterday after rubber producers agreed to cut output.
Mazda cut its full-year sales forecast by 5.1 percent to 1.405 million vehicles for the year ending March 31 as the global credit crunch and economic slowdown prompt consumers to spend less. The company reduced its North American sales estimate by 1 percent to 396,000 units, and trimmed its
Rubber futures reached a three-year low of 154.6 yen Oct. 28, plunging 57 percent from a 28-year high of 356.9 yen June 30, when record-high oil boosted investor demand for commodities as an inflation hedge.
Production Cut
The replanting may cut the nation's rubber output by 55,000 metric tons, Daud Husni Bastari, chairman of the Rubber Association of Indonesia, or Gapkindo, said today. That's about 2 percent of last year's Indonesian output of 2.8 million tons, according to figures from the International Rubber Consortium Ltd.
January-delivery rubber on the Shanghai Futures Exchange, the most-active contract, lost 2.7 percent to close at 13,330 yuan ($1,949) a ton.
Source : Bloomberg
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