Malaysia may quit rubber body

Malaysia may quit rubber body

KUALA LUMPUR (AP): Malaysia may quit the International Natural Rubber Organization if Thailand does, a newspaper said yesterday.

The Sunday Star quoted Primary Industries Minister Lim Keng Yaik as saying that if both countries pull out, it could lead to a price increase for natural rubber.

He said he had information that Thailand might pull out of the organization.

"This would not affect our rubber industry as natural rubber accounts for only 2.7 billion ringgit (US$700 million) of total revenue compared to rubber products, which bring in 4.5 billion ($1.2 billion) yearly," he said.

Furthermore, Malaysia was moving into rubber forest plantations, where timber is the primary product and latex is only a secondary product, Lim told reporters in Johor Bahru, 360 kilometers (228 miles) south of Kuala Lumpur.

He said a ministerial meeting of the rubber-producing countries in the Association of Southeast Asian Nations would be held soon to discuss problems within the industry.

Natural rubber produced by Malaysia, Thailand and Indonesia accounts for about 50 percent of the world's production.

Lim said the refusal of natural rubber consumer countries to renegotiate intervention rates was totally unacceptable because the price of natural rubber was ridiculously low.

"If consumer countries are not responsive to a fair and remunerative price, then we will call off the buffer stock mechanism and allow a price increase," he said.