18 March 2011
The current tight supply in major natural rubber producing countries will help support prices, after the market plunged from record high levels following an earthquake and tsunami in Japan, the Malaysian Rubber Board said Thursday.
Rubber prices plunged earlier this week after damage to tire and automobile factories in Japan raised concerns of a slowdown in natural rubber demand.
Malaysia is the world's third-largest producer of natural rubber after Thailand and Indonesia. The three countries comprise the International Rubber Consortium and account for about 70% of global natural rubber output.
The Thai government, through the International Rubber Consortium, has asked Indonesia and Malaysia to maintain prices after Thailand announced a minimum price for the commodity, IRCo acting Chief Executive Yium Tavarolit said.
He added that the three members have agreed to work together on any potential price control measures, which could include export suspension below a certain price level.
"Japan is not a major price-determining factor where natural rubber consumption is concerned. Nevertheless, we are closely watching the market and will take necessary measures if the need arises," an MRB official, who didn't wish to be named, told Dow Jones Newswires.
He refused to disclose whether Malaysia will follow Thailand's move to set a minimum price for the commodity.
However, officials at the Indonesian Rubber Association and MRB confirmed that they may meet with Thai exporters to discuss measures to halt the downtrend in prices.
Thailand's deputy prime minister Suthep Thaugsuban Monday pledged to maintain local rubber prices at no less than THB120 a kilogram. He also urged suspension of exports and is calling for a meeting of agencies Monday to discuss the measure, the Bangkok Post reported Wednesday.
(Source: http://www.irco.biz/BlogMoreDetial.php?id=2739&ShowContent=news)
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