Indonesia, KL, Thailand to meet on rubber price plan

Indonesia, KL, Thailand to meet on rubber price plan

BANGKOK (Reuters): Officials from Thailand, Indonesia and
Malaysia will meet in Kuala Lumpur in August to hammer out a way
of setting up a minimum selling price for rubber, a Thai minister
said on Wednesday.

"Senior officials from the three countries will discuss the
details next month in Kuala Lumpur," Deputy Agriculture Minister
Arkhom Engchuan told a news conference.

Thailand, Indonesia and Malaysia account for almost 80 percent
of the world's rubber production.

The plan was expected to be ready for a ministerial meeting of
the three countries in September, when it would be formally
implemented, Arkhom said.

He added that the plan was to prevent buyers from further
suppressing prices, which last year tumbled to their lowest
levels in 30 years, around 23 U.S. cents/lb, mainly due to a glut
in supply and weak demand. Prices are now around 25-26 U.S.
cents/lb.

The three countries would set a minimum dollar price that
would be used as a benchmark for RSS or TSR rubber, or both,
Arkhom said. Each country would agree not to sell below this
price and private exporters would be asked to cooperate.
Thailand is the world's top rubber exporter, while Indonesia is
second.

Ministers from the three countries met in Jakarta earlier this
month to discuss ways of boosting rubber prices. At the meeting,
Thailand and Malaysia agreed to set up a joint venture to buy the
138,000 tons of rubber held by the now-defunct International
Natural Rubber Organization (INRO).

INRO has said Thailand and Malaysia will need the consent of
its members to buy the rubber stocks, and the main issue will be
the selling price.

But Arkhom said he had told Thai officials who will be
attending an INRO meeting in Kuala Lumpur next week that Thailand
wanted to see INRO sell all its stocks as soon as possible.

"Thailand is willing to buy all the stocks of INRO no matter
how high the price is," Arkhom said.