KL, Bangkok join hands to stabilize rubber prices

KL, Bangkok join hands to stabilize rubber prices

KUALA LUMPUR (AFP): Malaysia and Thailand will set up a joint minister committee to intervene in domestic markets to help stabilize falling rubber prices, reports said Wednesday.

The joint effort will be a fore-runner to possible regional cooperation, with the two countries to make overtures to Indonesia soon, the New Straits Times daily reported.

Once Indonesia agrees, this tripartite arrangement will have the combined clout of the world's three largest rubber producers, accounting for almost 80 percent of global output.

Malaysian Primary Industries Minister Lim Keng Yaik was cited as saying that joint efforts was necessary in view of the anticipated demise of the International Natural Rubber Organization (INRO).

"We feel that the three biggest rubber producing countries should have a common stand," he said but denied that this was tantamount to creating a cartel.

Following a meeting with Thai Agriculture and Cooperatives Minister Newin Chidchob on Tuesday, Lim said the two countries would sign a memorandum of understanding on the joint committee in August in Chiengmai.

The committee will coordinate domestic market interventions, manage a joint buffer-stock, as well as facilitate technical cooperation and exchange of research findings and market intelligence.

It will determine how to manage the rubber stocks, the types of stocks to withhold and how, when and where to dispose them, Lim said, adding that Indonesia would be invited to join the plan.