Indonesia to replant rubber next year

Reuters, Jakarta

Indonesia, the world's second largest rubber producer after Thailand, will rehabilitate 100,000 hectares of rubber plantations a year for four years from 2002 to cut output and lift prices, the Agriculture Ministry said.

Director General of Plantations Agus Pakpahan said on Monday that the plan was Indonesia's way of fulfilling a pact made in September with other top producers Thailand and Malaysia to each reduce output by four percent next year.

It would also dovetail with Indonesia's efforts to add value to its rubber industry, Pakpahan told reporters.

"Over the next four years we will rehabilitate 100,000 hectares per year...It's also because our rubber trees are ageing," Pakpahan told reporters.

Pakpahan said financing of the rehabilitation program was still being discussed. He did not elaborate.

While waiting for new trees from replanting to produce, the government planned to build more rubber-based industries, Pakpahan added.

"We are going to restructure our rubber industry, which currently produces only latex and block rubber, so they can process the rubber wood and make other rubber-based products," Pakpahan said.

Indonesia expects the rehabilitation efforts could help boost productivity of its rubber trees from 600 kg per hectare to two tons per hectare in the longer term, he said.

"We expect our rubber-based industries to have grown rapidly by the time our productivity rises," he added.