INRO to continue rubber disposal in London, New York
INRO to continue rubber disposal in London, New York
KUALA LUMPUR (AFP): The International Natural Rubber Organization (INRO) yesterday agreed to continue selling stockpiled rubber in London and New York to calm rising prices, having exhausted regional stocks.
"The special INRO session decided that we continue what we have been doing, but this time focusing our sales in Europe and the United States as we have finished off our stocks in this region," Aldo Hofmeister, INRO's buffer stock manager, said.
"We will continue disposing of a little bit daily in London and New York," said Hofmeister, after the one-day special session to review INRO's buffer stock operations.
He declined to say how much of rubber INRO still had in warehouses in Europe and the United States.
But dealers estimated that whatever was left in Europe and the United States only made up about a quarter of the 220,000 tons INRO had before it began its sell-off on July 8, its first in five years, to stabilize the rubber market.
Hofmeister said he told INRO's six producer- and 20 consumer- member nations, including the European Union, at the meeting that speculators and a definite shortage of rubber had reduced the impact of his rubber sales.
"There was a definite void and we were unable to fill that completely and the members recognized that and have directed that we continue selling," he said.
At the close yesterday, Japan, the most volatile market in the region, closed barely changed, with first position at 147.3 yen a kilogram from 147.7 yen on Friday.
Hike
Delegates said producers were to have pressed for a hike in INRO's reference price -- the price range that guides the buffer stock manager's operations -- to better reflect rubber's current buoyant position.
"The meeting discussed the proposal briefly, but no decision was made on the reference price pending forthcoming negotiations to be held in Geneva on the new pact," said a delegate.
Prices, which three years ago were averaging 215.00 sen (79.6 U.S. cents) a kilogram (2.2 pounds), have in the past two months rocketed to six-year highs, the benchmark RSS 1 grade closing yesterday in Kuala Lumpur at 323.50 sen a kilogram.
INRO's five-day moving average, derived from average prices in London, New York, Singapore and Kuala Lumpur, has soared to 243.22 Malaysian-Singapore cents from 169-170 level at the end of 1991.
INRO members are to meet for UN-sponsored talks in Geneva in October to hammer out a new International Natural Rubber Agreement as a successor for the 1987-pact that expired in December and is on a one-year extension.