INRO begins meeting with future in doubt<\/p>\n
KUALA LUMPUR (Reuters): The International Natural Rubber
\nOrganization (INRO) began a meeting of its policy-making council
\non Thursday which officials said could determine the fate of the
\nworld's last commodity pact with economic clout.<\/p>\n
The council was expected to decide on a proposal to adjust
\nINRO's intervention price range at the two-day meeting in the
\nMalaysian capital, officials said.<\/p>\n
A press communique would be issued at the end of the meeting
\non Friday, INRO said in a statement.<\/p>\n
Industry officials said INRO's governing council was likely to
\napprove a proposal to raise the group's reference price in a
\nlast-ditch attempt to persuade Thailand and Malaysia to
\nreconsider their decision to leave the organization.<\/p>\n
But a Thail deputy minister said on Thursday it would not
\nreview its withdrawal decision even if reference prices changed.<\/p>\n
Under the proposal, INRO's reference price would be raised by
\nsix percent to 227.85 Malaysian\/Singapore cents per kg, and
\nintervention levels would be adjusted upwards accordingly.<\/p>\n
The new \"may-buy\" level would be 194 cents and \"must-buy\" 182
\ncents. The \"may-sell\" level would be 262 cents and \"must-sell\"
\n273 cents.<\/p>\n
The reference price is currently 214.95 cents, while the \"may-
\nbuy\" level is 183 cents, the \"must-buy\" 172, the \"may-sell\" 247
\nand the \"must-sell\" 258.<\/p>\n
Thailand and Malaysia have complained that the intervention
\nlevel is too low and should be raised.<\/p>\n
Several attempts have been made by INRO's governing council to
\nadjust the price range to reflect Asia's economic conditions, but
\nno consensus has been reached yet.<\/p>\n
Barring any second thoughts, Malaysia will leave INRO on
\nOctober 15 after a year's notice while Thailand has said it would
\nalso quit. Both countries said INRO failed to shore up rubber
\nprices, now at long-term lows.<\/p>\n
Thailand said on Thursday it may resume local rubber market
\nintervention to boost prices.<\/p>\n
Industry officials said INRO was doomed to collapse with the
\nwithdrawal of Thailand and Malaysia, which together account for
\nmore than 50 percent of the world's production.<\/p>\n
Officials said the council would also decide on a proposal to
\nreplace the daily market indicator price for INRO's price range,
\ncurrently a hybrid of the Malaysian ringgit and the Singapore
\ndollar, by a single currency, perhaps the Singapore dollar.<\/p>\n
\"This could result in a larger increase in the reference price
\nthan what the producers had asked for,\" an official said.<\/p>\n
Some delegates said council members might not be able to
\ndecide on INRO's fate this week and put off a decision until
\nJuly.<\/p>\n
INRO, set up in 1980 to stabilize world rubber prices under
\nthe U.N. Conference on Trade and Development (UNCTAD), groups six
\nrubber producing and 16 consuming countries.<\/p>\n
The producers are Thailand, Indonesia, Malaysia, Ivory Coast,
\nNigeria and Sri Lanka.<\/p>\n
Consuming members are the United States, Japan, China,
\nGermany, France, Austria, Belgium, Luxembourg, Denmark, Finland,
\nGreece, Ireland, Italy, the Netherlands, Spain, Sweden and
\nBritain. Belgium and Luxembourg are considered as one member.<\/p>",
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