Consortium to buy rubber

Consortium to buy rubber

KUALA LUMPUR (AFP): The world's three key natural rubber producers will set up a consortium to buy about 140,000 metric tons of the commodity on the international market, reports said Saturday.

Lim Keng Yaik, Malaysia's primary industries minister said the move by Malaysia, Thailand and Indonesia, who account for about 80 percent of global output, was aimed to stabilize rubber prices.

"If possible, we will provide a soft loan to the consortium to purchase rubber in order to stabilize the price in the international market," he was quoted as saying by the New Straits Times newspaper.

In October, Thailand and Malaysia decided to withdraw from the International Natural Rubber Organization (INRO), a 19-year-old organization linking producers and consumers.

Thailand and Malaysia say INRO had failed to raise prices, which are currently at 30-year lows.

But Indonesian officials had expressed fears that without an organization such as INRO to support prices, there would be a further fluctuation of rubber prices.