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RUBBER-Japan futures falter as Trump's tariffs counter off-season supply woes

ReutersMar 4, 2025 2:39 AM

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  • Japanese rubber futures nudged lower on Tuesday as new U.S. tariffs on Canada, Mexico and top rubber consumer China are set to go into effect within hours, outweighing a tightening supply outlook.

  • The Osaka Exchange (OSE) rubber contract for August delivery JRUc6, 0#2JRU: was down 2.5 yen, or 0.69%, at 359.7 yen ($2.41) per kg, as of 0214 GMT.

  • The rubber contract on the Shanghai Futures Exchange (SHFE) for May delivery SNRv1 edged 45 yuan lower, or 0.25%, to 17,710 yuan ($2,430.32) per metric ton.

  • The most active April butadiene rubber contract on the SHFE SHBRv1 fell 275 yuan, or 1.95%, to 13,850 yuan ($1,900.62) per metric ton.

  • U.S. President Donald Trump said the implementation of 25% tariffs will take effect from Tuesday, causing automaker shares to slide. General Motors GM.N dropped 4% and Ford F.N slipped 1.7% in overnight session.

  • The automobile sector is particularly likely to feel the impact of tariffs due to the supply chains that criss-cross the three countries, as well as the expected increase in vehicle prices, a professor said.

  • Automobile sales could influence the intensity of automobile manufacturing, which involves using rubber-made tyres.

  • Beijing vowed on Tuesday to retaliate against fresh U.S. tariffs after Trump threatened an extra 10% duty on Chinese imports, leading to a cumulative 20% tariff.

  • Still, domestic production areas in China have stopped harvesting while the supply in southern Thailand has shrunk, ushering the global natural rubber supply to a seasonal low, said Chinese commodities data provider Longzhong Information in a note.

  • Rubber crops usually undergo a season of low production from February to May, before a peak harvesting period that lasts until September.

  • The front-month rubber contract on Singapore Exchange's SICOM platform for March delivery STFc1 last traded at 204.5 U.S. cents per kg, down 0.1%.

($1 = 149.1300 yen)

($1 = 7.2871 Chinese yuan)

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