Thailand, RI and Malaysia mull rubber export quota

Thailand, RI and Malaysia mull rubber export quota

KUALA LUMPUR (AFP): The world's top three rubber producers --
Thailand, Indonesia and Malaysia -- may adopt a joint export
quota to control supply to boost sagging prices, a report said
Wednesday.

A Malaysian official said apart from export quotas, a supply
rationalization and stockpile scheme was also being considered.

Senior officials of the three Southeast Asian countries are
meeting in Kuala Lumpur under the Tripartite Rubber Cooperation
(TRC) for the third time. It held its first meeting in 2000 in
Indonesia.

"We are leaving no stone unturned in devising an effective
mechanism to boost rubber prices," the official was quoted as
saying by Business Times newspaper.

Thailand, Indonesia and Malaysia together produce 79 percent
of the world's natural rubber.

The newspaper said all proposals and recommendations emerging
from the discussions would be forwarded to the ministers for
adoption Friday.

At a meeting last July in Bangkok, Malaysian Primary
Industries Minister Lim Keng Yaik along with his two counterparts
agreed to cut rubber output by four percent a year from 2001.

"With strong cooperation from all three producers, the TRC can
be expected to boost prices substantially," the official said.

"TRC will come up with an equitable reference price for member
countries to sell rubber on the open market."

The goal is to safeguard the long-term welfare of smallholders
who depend on rubber as their main source of income, he added.

Lim along with Thailand's deputy minister of agriculture and
cooperative Natee Khlibthong and M.S. Soewandi, Indonesia's
minister of industry and trade would meet Friday.

A communique is expected to be issued after the meeting, an
industry source familiar with the discussions told AFP Wednesday.

He said Malaysia would like to see the SMR rubber price move
up to 3.00 ringgit (79 US cents) per kilogram. The price now is
53 cents.

Thailand produces about 2.3 million tons of rubber a year,
Indonesia 1.4 million tons and Malaysia 650,000 tons.

The source said the ailing rubber prices were due to over
production, high stock and poor demand and competition from
synthetic rubber.

"Although the three countries produce 79 percent of total
natural rubber output, we still are unable to control the
prices," he lamented.