JPX Rubber Futures (RSS3 Futures) Rise on Higher Crude Oil Prices
According to Reuters, the Osaka Exchange (JPX) RSS3 Rubber Futures experienced a slight increase on 2nd April, driven by stronger oil prices and a weakened yen. This is despite ongoing efforts in the market to consolidate following a significant rally last month.
The Osaka Exchange (OSE) rubber contract for September delivery, JRUc6, closed up by 0.4 yen, or 0.12%, at 325.5 yen ($2.15) per kilogram.
Meanwhile, the rubber contract on the Shanghai Futures Exchange (SHFE) for September delivery, SNRv1, fell by 35 yuan to finish at 14,615 yuan ($2,020.07) per metric ton.
According to a technical analysis by Japan Exchange Group, prices are currently in a consolidation phase and are expected to remain within the range of 305-345 yen in the coming weeks.
Oil prices rose on 2nd April, supported by signs of improving demand in China and the United States, as well as growing concerns about escalating conflict in the Middle East.
The yen weakened overnight to 151.71 against the dollar, making yen-denominated assets more affordable to overseas buyers. Japanese Finance Minister Shunichi Suzuki reiterated authorities' readiness to take appropriate action against excessive exchange-rate volatility.
Crude Oil Prices Are on the Rise
According to Reuters, Crude Oil prices have increased by about 1% on 1st April, with United States futures reaching a five-month pinnacle, buoyed by expectations of robust economic growth in both the U.S. and China.
This optimism regarding demand was complemented by tightening supplies resulting from OPEC+ output reductions and recent attacks on Russian refineries.
ICE Brent Crude futures price for June delivery concluded at $87.42 per barrel on 1st April, marking June's inauguration as the front month. This represented a rise of approximately 42 cents, or 0.5%, from the 28th April settlement price for the June contract. Notably, the May Brent futures contract settled at a five-month high of $87.48 per barrel.
Meanwhile, U.S. West Texas Intermediate (WTI) crude futures surged by 54 cents, or 0.7%, to settle at $83.71 per barrel, marking their highest closure since 27th October.
In the U.S., the manufacturing sector exhibited growth in March for the first time in 1-1/2 years. However, employment in factories remained subdued, coupled with notable price increases for inputs. Analysts at ING remarked that while the manufacturing data could reduce the likelihood of significant rate cuts by the U.S. Federal Reserve, weak construction figures and forthcoming jobs data could still influence market sentiment.
In China, manufacturing activity expanded in March for the first time in six months, signalling positive prospects for the world's largest crude importer. Observers anticipate that robust summer gasoline demand and a resurgence in Chinese oil demand could contribute to sustaining oil prices at the $100 per barrel mark.
Where are Rubber Futures Traded?
Due to its popularity, Rubber Futures are traded on several different Exchanges. Traders can trade Rubber Futures from Singapore Exchange (SGX), Shanghai International Energy Exchange (INE), and Osaka Exchange Incorporated (JPX) through Orient Futures Singapore.
Orient Futures is a futures trading Singapore company and is an indirect subsidiary of Shanghai Orient Futures.
INE offers TSR20 Rubber Futures contracts, JPX offers Rubber RSS3 Futures, and SGX offers both SICOM RSS3 and TSR20. Traders can also capitalize on rubber cross-arbitrage, capitalizing on the price differences of rubber from different markets.
About Rubber Cross-Arbitrage
Cross arbitrage involves the Import and export trading of spot goods. When a significant price difference occurs, traders will take this opportunity to make profits by importing and exporting. This large volume of movements will then rebalance the prices of both products back into equilibrium.
Cross Arbitrage opportunities are usually used for futures as the response time is faster and it is easier to apply the strategy. It is also important to note that arbitrage strategies are usually done where delivery bids are similar and where the price movements of futures contracts in different markets have a very strong correlation.
The location of the exchange can also affect the proportion of investments. Factors that can affect arbitrage include:
- Differences in contract size
- Currencies
- Change in tax rate
- Policies on domestic storage, customs policy adjustment, and industry policy changes
These factors will cause price differences amongst different exchanges in different countries. Cross-Arbitrage also works for other Futures contracts such as Refined Copper Arbitrage Trading and more.
SGX Rubber Futures Contract Specifications
SGX TSR20 Rubber Contract Specification
The SGX TSR20 Rubber Futures contract follows the following specifications:
The SGX TSR20 Rubber Futures Contract has a minimum price fluctuation of 0.1 USD/kg.
SGX TSR20 Rubber Futures Ticker symbol: TF
SGX RSS3 Rubber Contract Specification
The SGX RSS3 Rubber Futures contract follows the following specifications:
The SGX RSS3 Rubber Futures Contract has a minimum price fluctuation of 0.1 USD/kg.
SGX RSS3 Rubber Futures Ticker symbol: RT
SGX Rubber Futures Contract Period
Contract months are monthly all year round, with next consecutive month added upon each month's expiry.
The last trading day of the SGX Rubber Futures contract month is the last day of trading of the month preceding the Delivery Month.
SGX Trading Hours
SGX Trading Hours are as follows:
9:00am - 11:30pm/ 1:30pm – 3:00pm, Beijing Time, Monday to Friday, and other trading hours announced by DCE. (T-session)
Start Trading With Orient Futures Singapore
Being an Overseas Intermediary of Shanghai International Energy Exchange (INE), Dalian Commodity Exchange (DCE), and Zhengzhou Commodity Exchange (ZCE), when foreign clients participate in internationalised futures contracts in these Chinese markets with us, they have direct access to trading, clearing, and settlement. Our parent company, Shanghai Orient Futures, is the largest broker in terms of aggregated volume across the five regulated exchanges in China.
Orient Futures Singapore also currently holds memberships at the Singapore Exchange (SGX), Asia Pacific Exchange (APEX), and ICE Futures Singapore (ICE SG). Starting August 2023, corporate clients can also gain access to the B3 Exchange through us.
We provide bespoke services to our professional clients, tailored to their corporate and individual needs. Our team will be there for you 24 hours on trading days to provide a one-stop portal for all your trades, with simple processes and an intuitive user interface that has low or near-to-zero latency.
