Govt to cut rubber output<\/p>\n
Debbie A. Lubis, The Jakarta Post, Jakarta<\/p>\n
The government plans to cut rubber output by 60,000 tons this
\nyear and 75,000 next year in a bid to boost sagging prices of the
\ncommodity, according to an official from the Ministry of
\nAgriculture.<\/p>\n
Head of the subdirectorate of institutional cooperation at the
\nDirectorate General of Plantations, Irmia Nur Andayani, said the
\nplan was part of a tripartite agreement with Malaysia and
\nThailand to cut output by 4 percent per year over the next two
\nyears.<\/p>\n
Indonesia is the second largest rubber producer in the world
\nafter Thailand with a total output of 1.55 million tons last
\nyear.<\/p>\n
Speaking to reporters at a press conference, Irmia said that
\nin order to achieve the target the government would launch a
\nsupply management scheme (SMS), a program to reduce rubber output
\nby replanting old rubber plantations, prohibiting the expansion
\nof existing rubber acreage and switching to other crop
\ncultivation.<\/p>\n
She said that Indonesia had 3.4 million hectares of rubber
\nplantations, and that 107,300 hectares of these would be affected
\nby the output cut this year.<\/p>\n
She added that around 97,450 hectares would be replanted while
\nthe remaining 9,850 hectares would be allocated for intercropping
\nand crop conversion.<\/p>\n
For next year, some 149,650 hectares would be affected, of
\nwhich 118,150 hectares would be replanted, 16,150 hectares given
\nover to intercropping, and 15,350 hectares allocated for crop
\nconversion.<\/p>\n
She explained that the ministry planned to implement the
\nreplanting effort in the first and second quarters of this year,
\nwhile intercropping was being targeted for the third quarter.<\/p>\n
Since tapping can only begin seven years after replanting, the
\nmethod is a useful tool for cutting output, she said.<\/p>\n
She did not specify what the cost of the replanting and crop
\nconversion efforts would be, but said that the budget would be
\nobtained from both the national and provincial levels, and also
\nfrom society's participation and partnerships with business.<\/p>\n
Irmia said that the progress of the scheme would be reported
\nevery month to the Rubber Association of Indonesia (Gapkindo).<\/p>\n
Meanwhile, Gapkindo chairman Asril Sutan Amin predicted that
\nrubber prices would rise to 70 U.S. cents per kilogram following
\nthe cut in rubber supply.<\/p>\n
Standard Indonesian rubber 20 grade is currently priced at
\nbetween 54 cents and 56 cents per kilogram, free-on-board for
\nFebruary shipments.<\/p>\n
Asril also said that the government would cut 2002 exports by
\n10 percent to some 1.23 million tons.<\/p>\n
Asril said that in order to finance the export cut program,
\nGapkindo members would need to take out loans of up to US$60
\nmillion from banks.<\/p>\n
He added, however, that although rubber exporters would have
\nto talk directly with the banks to get the loans, the Indonesian
\ngovernment had asked three national banks to provide negotiable,
\ninstead of commercial rates.<\/p>\n
He also explained that there was a drop in last year's rubber
\nexports to 1.34 million tons from 1.38 million tons in 2000.<\/p>\n
He said that last year's output was the same as two years ago,
\nnamely 1.55 million tons.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-to-cut-rubber-output-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}