INRO sees progress at October talks

INRO sees progress at October talks

SINGAPORE (Reuters): The International Natural Rubber
Organization (INRO) expects to make progress by the end of
October on healing a rift that threatens to scupper the accord, a
top INRO official said on Tuesday.

"We hope by the end of October to make some progress," Deputy
Executive Director Gerard Loyen told Reuters in an interview.

A small group of producers and consumers are to meet next week
to mull a paper on the pact's future and wider full council talks
are set for October 22 and 23.

"We hope by then to have proposals from producers and for
consumers to reach a more open position," said Loyen.

INRO, the world's last surviving producer-consumer commodity
pact with the power to steer prices, runs a serious risk of
foundering as a result of mounting opposition from producing
countries over its failure to lift prices.

The world's third largest producer Malaysia has already vowed
to pull out and the biggest producer Thailand is tipped to
follow suit, but number two Indonesia has pledged to stick by the
accord.

INRO intervenes in the rubber market by buying or selling when
the price reaches pre-set levels and the price range is revised
periodically in line with market trends.

But prices have suffered relentless pressure from tumbling
consumption due to the Asian economic crisis and rising exports
from Thailand and Indonesia where producers have cashed in on
high local prices driven by depreciating currencies.

INRO was set up in 1980 under the United Nations Conference on
Trade and Development (UNCTAD) and was one of a string of price-
influencing pacts that operated during the 1980s.