Thailand, the world's biggest rubber producer, is falling short of its target for chopping down and replanting rubber trees, part of its plan for reducing supply and propping up prices, officials and traders said on Thursday. "Around 100,000 rai of rubber plantation have been cut down and replanted since the programme started in October 2008," Suvich Surachetpong, a senior official at the Office of the Rubber Replanting Aid Fund, told Reuters.
That area of 100,000 rai equates to 16,000 hectares, only a quarter of the 64,000 hectares Thailand committed itself to replanting by September under an agreement with Indonesia and Malaysia. Those countries, the world's top three rubber producers, met in Bangkok last October as prices dropped to their lowest in nearly seven years.
Under the plan, Indonesia, the second biggest producer, was supposed to replant up to 55,000 hectares of rubber trees and Malaysia around 50,000 hectares. No details were available on their progress. Replanting rubber trees is one way to reduce short-term supply as the trees need at least five years to mature and start producing latex. Thailand is paying farmers 11,000 baht ($324) per rai to encourage them to cut down and replant trees.
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