Natural rubber advanced to the highest in five months as buyers in China, the world’s largest user, increased purchases and Japan’s stimulus spending raised speculation that tyre demand may revive.
China’s natural rubber imports reached 190,000 tonnes in March, compared with a total of 180,000 tonnes of purchases in the first two months of this year, according to data from the Beijing-based customs office.
Rubber for September delivery, the most-active contract, rose 2.2 per cent to settle at 178.2 yen a kg ($1,770 a tonne) on the Tokyo Commodity Exchange. Earlier, futures rose as much as 3.1 per cent to the highest since November 12.
China’s passenger car sales increased 10 per cent in March from the year ago period to a record 772,400 in the month, according to China Association of Automobile Manufacturers. Demand for minivans surged 40 per cent last month as the Chinese government began giving out 5 billion yuan ($732 million) in subsidies to help rural residents buy vans and light trucks.
Bridgestone Corp, the world’s largest tyre maker by sales, will spend $98 million to increase production capacity 54 per cent in China by the second half of 2011, the Tokyo-based company said in a statement today. The company will be able to make about 12,000 radial tyres a day for passenger cars at its plant in Wuxi, Jiangsu, the statement said.
Minicar Subsidy
Futures also gained as Japan will spend 370 billion yen to subsidise purchases of new, fuel-efficient vehicles to stem sliding sales, thereby boosting speculation that rubber demand from tyre makers may increase, Shigemoto said.
Japan will give consumers 250,000 yen to buy a new car or 125,000 yen for a minicar when they scrap vehicles that are 13 years old or older. The government will pay 100,000 yen for the purchase of a new car and 50,000 yen for a minicar.
The subsidy is part of Prime Minister Taro Aso’s 15 trillion yen stimulus package unveiled on April 10. The government has begun tax breaks on fuel-efficient models starting this month to spur auto demand.
