Japan futures trim gains as Trump’s auto tariff threat hits sentiment
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Rubber futures slide on demand concerns
Japanese rubber futures (trb1!) fell 1.28% to 369.3 yen per kg, reversing earlier gains as Donald Trump’s 25% auto tariff threats raised concerns over global car production and demand for tyre materials. Similarly, Shanghai rubber futures (rss31!) dipped 0.22% to 17,780 yuan per ton, while shfe butadiene rubber (shbrv1) lost 0.53% to 14,005 yuan per ton.
Auto sector hit as tariffs could cost industry $40 billion
Annually trump’s proposed auto tariffs could add $110 million in daily costs for the industry, potentially reaching $40 billion annually if automakers do not shift production. As a result, japanese auto stocks declined, dragging down broader equities.
Tightening supply offset by weaker demand outlook
While rubber supply is tightening due to the seasonal wintering period in Thailand, Africa, and Vietnam, weaker auto demand is capping price gains. Additionally, Thailand’s meteorological agency has warned of potential crop damage from february 22-25, which could further disrupt supply.
China AI stocks provide some market support
While rubber markets struggled, chinese equities rallied on continued gains in artificial intelligence-related stocks, lifting sentiment across broader asian markets.
Trading outlook
Rubber futures remain under pressure, with tf1! (singapore rubber) down 0.2% to 203.4 cents per kg. traders are closely watching the impact of tariff developments and supply disruptions. Resistance for osaka rubber futures sits at 375-380 yen, while support holds around 365 yen.
Japanese rubber futures (trb1!) fell 1.28% to 369.3 yen per kg, reversing earlier gains as Donald Trump’s 25% auto tariff threats raised concerns over global car production and demand for tyre materials. Similarly, Shanghai rubber futures (rss31!) dipped 0.22% to 17,780 yuan per ton, while shfe butadiene rubber (shbrv1) lost 0.53% to 14,005 yuan per ton.
Auto sector hit as tariffs could cost industry $40 billion
Annually trump’s proposed auto tariffs could add $110 million in daily costs for the industry, potentially reaching $40 billion annually if automakers do not shift production. As a result, japanese auto stocks declined, dragging down broader equities.
Tightening supply offset by weaker demand outlook
While rubber supply is tightening due to the seasonal wintering period in Thailand, Africa, and Vietnam, weaker auto demand is capping price gains. Additionally, Thailand’s meteorological agency has warned of potential crop damage from february 22-25, which could further disrupt supply.
China AI stocks provide some market support
While rubber markets struggled, chinese equities rallied on continued gains in artificial intelligence-related stocks, lifting sentiment across broader asian markets.
Trading outlook
Rubber futures remain under pressure, with tf1! (singapore rubber) down 0.2% to 203.4 cents per kg. traders are closely watching the impact of tariff developments and supply disruptions. Resistance for osaka rubber futures sits at 375-380 yen, while support holds around 365 yen.