Farmers load rubber sheets onto a truck to sell them at a market in Phanom district, Surat Thani (Photo: Bangkok Post)
 

Hanoi (VNA) – Thailand, the world’s largest rubber producer, is coordinating with Malaysia and Indonesia to reduce rubber supply in order to stabilise prices.

The three countries, which account for around 70 percent of the world's natural rubber supply, recently held a meeting to find ways to ensure the price stability and increase domestic demand for natural rubber, said Titus Suksaard, Chief of the Rubber Authority of Thailand on April 23.

Stabilising rubber price is significant when the price keeps swinging, Suksaard noted, adding that Thailand’s supply has not recovered from last year’s severe flood in the southern region while rubber farmers in India and Indonesia reduced rubber output.

He also said rubber prices should be at least 20 percent more than production costs. The current price of rubber in Thailand is 1.8 USD per kilogram while production cost is 1.4 USD per kilogram.

Growth of the global automobile industry averaging 7.37 percent per year is a major element to boost rubber prices, he added.

Thailand has approved to extend a rubber price subsidy programme worth 20 billion THB (about 600 million USD) and loan packages totalling 10 billion THB (29 million USD) to help private rubber processing operators continue production.

Malaysia, Indonesia and India have also implemented policies to reduce rubber plantation to bolster market prices.

The rubber bodies among the three countries will popularise information of rubber markers to avoid rubber speculation. - VNA