Rubber producers to hold talks, set intervention price

Rubber producers to hold talks, set intervention price

Dow Jones, Bangkok

Ministers from the world's top three rubber producers - Thailand, Indonesia and Malaysia - will meet in February to discuss strengthening cooperation within the rubber industry and set intervention prices, Thai Prime Minister Thaksin Shinawatra said Monday.

The meeting will be held in Bangkok but the exact date hasn't been finalized, Thaksin told reporters after meeting with Malaysian Primary Industries Minister Lim Ken Yaik in Bangkok.

The ministers will discuss setting intervention price levels in case they need to curb any fall in rubber prices, he said, adding that the joint rubber consortium - the International Rubber Consortium Ltd., or IRCo, will be the intervention body.

Last October in Bali, ministers from Thailand, Indonesia and Malaysia signed a shareholders' agreement for IRCo, marking their effort to form the consortium to manage rubber stocks, trade and prices.

The consortium, which hasn't started operations yet, will be able to buy and stockpile rubber to stabilize rubber prices if necessary.

"(The ministers) will discuss management of the consortium and rubber market in an effort to accomplish our aim to stabilize rubber prices at a level of $1 to $1.5 per kilogram," Thaksin said.

Thai ribbed smoked sheet rubber 3 grade for export was offered Monday for around $1.24-$1.26/kg, free-on-board basis.

An official at the Rubber Research Institute of Thailand said IRCo shareholders will meet Jan. 28 to appoint the board of the company and the Thailand-based consortium will be incorporated soon afterwards.

Thaksin said an IRCo-like palm oil joint venture will be set up later. Malaysia, the world's leading palm oil producer, will be the main driver for setting up that venture, he said.