Projections blamed for fall in rubber prices<\/p>\n
KUALA LUMPUR (AFP): Malaysia yesterday blamed bloated
\nprojections of rubber output by rival producing countries for the
\n30 percent fall in prices in the last few months just when the
\nmarket were enjoying its six-year highs.<\/p>\n
Primary Industries Minister Lim Keng Yaik said the recent
\nfigures provided by producers to the Association of Natural
\nRubber Producing were \"unrealistically higher and painted a
\nsurplus situation.\"<\/p>\n
That drove down prices as consumers halted buying in
\nanticipation of lower prices, Lim was reported saying in northern
\nPerak state.<\/p>\n
He said Tuesday's move by the International Natural Rubber
\nOrganization (INRO) to raise its buffer stock reference price by
\nfive percent to 206.68 Malaysian\/Singapore cents a kilogram (2.2
\npounds) was appropriate as it would stabilize prices.<\/p>\n
INRO groups six producer and 21 consuming countries. Among its
\nmembers are producers Malaysia, Indonesia and Thailand and
\nconsumers the United States, Japan and the European Union.<\/p>\n
The revision would allow the INRO buffer stock manager to
\nenter the market earlier to buy rubber and prop up declining
\nprices as the intervention levels, which are pegged to the
\nreference price, will be raised by 15 percent and 20 percent
\nrespectively.<\/p>\n
Lim reiterated the need for producers to stay united and stop
\nundercutting each other as this would benefit only consumers.<\/p>\n
\"Since we (producers) are unable to put our act together, we
\nare always bullied and dominated by consuming countries,\" Lim
\nsaid.<\/p>\n
Traders blamed the current fall in prices on market
\nmanipulation and speculation.<\/p>\n
\"Fundamentally, the market should remain high and prices will
\npick up in the longer term,\" a Singapore-based trader said.<\/p>\n
He said although production was rising, consumption was fast
\ncatching up, particularly in the Asian region, particularly in
\nChina and Japan.<\/p>",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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