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Roundup: Thai rubber planters call for halt to price falls

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(GlobalPost/GlobalPost)

Roundup: Thai rubber planters call for halt to price falls

BANGKOK, Aug. 26 (Xinhua) -- Thai rubber planters on Tuesday insisted that newly-appointed Prime Minister Gen. Prayuth Chan- ocha immediately keep rubber prices from dropping or they might probably go out of business.

Rubber planters in 63 provinces throughout the country lodged petitions to Prayuth via provincial governors calling for him to stop the rubber prices from plummeting in domestic markets, according to Boonsong Nabtong, head of the Rubber Planters Association of Thailand.

For the time being, the rubber planters urged the new premier to scrap a reported plan of the Rubber Estate Organization (REO) to sell off a total of 210,000 tons of rubber which it had earlier bought from the rubber planters because, he said, it could otherwise push the prices further down, Boonsong said.

"The rubber prices which are already low today will certainly be lowered so much that the planters might be no longer able to make ends meet and might finally go out of business. The REO plan to dump as much as 210,000 tons of rubber in the markets will undoubtedly be disastrous to the planters, who are already suffering a critical loss," he said.

The rubber prices in the domestic market are currently hitting a record low in five years selling in the range of 48 to 53 baht ( 1.6 to 1.8 U.S. dollars) per km while the producing costs for the rubber planters amount to an average of 65 baht (2.2 U.S. dollars) per km.

The rubber agency under care of the Agriculture Ministry had purchased the 210,000 tons of rubber for 100 baht (3.3 U.S. dollars) per kilo with the plan to sell it off at a loss to a private firm for 51 baht (1.7 U.S.dollars) per kilo.

The REO purchase was primarily designed to intervene in the rubber market and bolster the prices for the sake of the planters, however.

Though the rubber planters will not take to Bangkok streets in the face of the sustained rubber price fall, they were desperately insisting that the army strongman-turned-premier take immediate steps to keep the price from falling further and look for ways and means to bolster it up for the sake of the rubber planters nationwide, according to Boonsong.

He said a large volume of rubber is currently being produced nationwide and the authorities should see to it that it will be given a "fair" price.

"In the face of the prolonged price crisis, the new premier is suggested to contain the price falls, beginning with the cancellation of the REO plan to dump its cheap rubber into the domestic market," he said.

Prayuth earlier commented that the authorities could not prevent the rubber prices from dropping under market mechanisms and that the planters may have oversupplied the markets only to see the prices falling further.

"The rubber planters called on the authorities to intervene in the markets and boost up the prices but we do not have the money to meet such demands," he bluntly said during a press conference earlier this month.

Meanwhile, the rubber planters leader urged the premier to see to it that more rubber will be used locally as the world export markets have ordered less.

Rubber can be used with asphalt to pave roads throughout the country or used in the making of playgrounds at athletic stadiums besides the production of industrial gloves, tires and condoms, according to the association leader.

As much as 300,000 tons of rubber could possibly be consumed by such manufacturing sectors in a year, he said.

http://www.globalpost.com/dispatch/news/xinhua-news-agency/140826/roundup-thai-rubber-planters-call-halt-price-falls