Top rubber nations endorse support plan
Top rubber nations endorse support plan
BATAM, Riau (Reuters): Senior officials from the world's top
rubber exporters - Thailand, Indonesia and Malaysia - agreed a
scheme to support ailing natural rubber prices that have lingered
near 30 year lows, delegates said on Friday.
But the plan has still to be approved by ministers from the
three countries and a date for the ministerial meeting will be
announced later.
"What I can say is that the meeting is successful and we have
reached an agreement on a minimum selling price, stock
withholding as well as forward sales," said Dheerayutha
Kantaratanakul, director of Thailand's state-owned Rubber Estate
Organization.
He declined to give further details.
"There is a positive result of the meeting," said Herry
Soetanto, director for Multilateral Cooperation at Indonesia's
Ministry of Industry and Trade.
Commenting on the minimum selling price, a Thai official said
"It is a very good price level... the price would be a two digit
number per kg," he told Reuters, but declined further details.
Other officials denied market talk that the price would be 68
cents a kg, and commented that it was not possible to apply just
one price to the different grades of rubber produced by the three
countries.
On stock withholding, officials said that no overall amount
had been set for the three countries.
"There is no need to set the amount of stock to be withheld in
each country... it can work well by only setting a minimum
selling price," Dheerayutha said.
On forward sales, a Thai official said: "We would say that up
to three months forward for exporters to sell contracts in
advance is the most suitable.".
The date of the ministerial meeting to approve the rubber
scheme has yet to be decided as Indonesia says its trade and
industry minister is not available in December and Thailand
prefers the meeting to be held before elections on January 6.
Asian rubber traders have reacted skeptically to attempts by
the three largest producers to set a minimum selling price saying
the plan will be difficult to implement and hard to finance.
But governments of Thailand, Indonesia and Malaysia are aware
that the rubber industry is an important political force.
Unlike palm oil, most rubber output in the area is from small
holdings, many less than two hectares in size.