World's natural rubber price may increase to US$1.20<\/p>\n
Sari P. Setiogi
\nThe Jakarta Post
\nJakarta<\/p>\n
The price of natural rubber on the global market could
\nincrease to US$1.20 per kilogram by the middle of this year from
\n$0.90 at present, as world demand grows and supply declines.<\/p>\n
Rubber Association of Indonesia (Gapkindo) chairman Asril
\nSutan Amir said on Tuesday the increased demand would come mostly
\nfrom China, Japan, Taiwan and South Korea.<\/p>\n
This year, some Asian automotive companies are expected to
\nincrease their production, which would increase the demand for
\nnatural rubbers for tires. This, in turn, would cause the price
\nof natural rubber to rise, Asril said.<\/p>\n
\"In the meantime, the stock level of rubber in consumer
\ncountries is low, giving producer countries the privilege of
\nsetting prices,\" he said.<\/p>\n
Asril said rubber plantation areas in Indonesia would decrease
\nto 3.1 million hectares this year from 3.24 million hectares in
\n2002.<\/p>\n
\"Farmers are not patient enough to grow slow-yielding rubber
\ntrees, preferring oil palm trees,\" he said.<\/p>\n
In August 2002, the world's largest rubber producers --
\nIndonesia, Malaysia and Thailand -- signed a memorandum of
\nunderstanding on the establishment of the International
\nTripartite Rubber Companies Consortium, whose main duty is to
\nhelp boost the sagging price of the commodity.<\/p>\n
Under the council's framework, the three countries agreed to
\ncut rubber output by 4 percent and rubber exports by 10 percent
\nstarting last year.<\/p>\n
In 2002, Indonesia lowered its rubber exports to 1.23 million
\ntons, while Thailand limited its exports to 1.93 million tons and
\nMalaysia 227,000 tons.<\/p>",
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