August 12, 2019 / 2:48 AM / 4 months ago

Shanghai's new rubber futures bounce on trading debut

BEIJING, Aug 12 (Reuters) -

* TSR 20 rubber futures rise almost 10% in their first trading session on the Shanghai International Energy Exchange (INE) on Monday.

* The front-month contract, for delivery in Feburary 2020, surges as much as 9.9% from the 9,260 yuan ($1,311.34) a tonne opening price to 10,175 yuan, before easing back to 9,810 yuan as of 0243 GMT.

* China wants the TSR 20 rubber contract to be a benchmark for international rubber prices, Fang Xinghai, vice chairman of the China Securities Regulatory Commission, said in a speech at the launch ceremony.

* “Global production of natural rubber is over 12 million tonnes of which 70% are used for tyre manufacturing, and over 80% of the tyre manufacturers use the TSR 20 rubber benchmark,” John Browning, managing director of brokerage Bands Financial, said in a note.

* Japan’s TOCOM exchange, home to the current regional rubber benchmark, is closed on Monday for a public holiday, meaning the “arbitrage opportunity between INE and TOCOM rubber is unavailable this morning,” Browning added.

* TSR, or technically specified rubber, 20 futures are the fourth commodities futures in mainland China that are open to foreign investors after INE crude oil, iron ore in Dalian and purified terephthalic acid (PTA) in Zhengzhou. ($1 = 7.0615 Chinese yuan renminbi) (Reporting by Tom Daly; editing by Richard Pullin)

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