Thailand's government could buy up to 200,000 tonnes of unsmoked rubber to push the price up to 120 baht ($3.79) per kg after protests from farmers over low prices, government and farmers' officials said on Wednesday. Uthai Sonlaksap, an adviser to the Thailand Farmers Association, said Agriculture Minister Theera Wongsamut and farmers' groups had reached a tentative agreement on intervention late on Tuesday.
The price of unsmoked rubber sheet (USS3), which farmers sell to rubber factories, has halved since last February and was quoted at 95 baht per kg on Wednesday. It ended 2011 at 90 baht per kg. Despite the modest rise, farmers have protested in the new year and had threatened to dump latex in front of the home of Prime Minister Yingluck Shinawatra this week.
The intervention plan has to be ratified by the National Rubber Committee, made up of ministers and government officials, on January 17 and will then need to be approved by the cabinet on January 24, Uthai said. Pornsuk Charoenprasert, the deputy agriculture minister, confirmed those dates. "It will be immediately implemented once the cabinet approves the budget plan," he said. The government said in November that it was ready to step in and buy unsmoked rubber sheet (USS3) from farmers if necessary, but it was talking about a floor price of 95 baht per kg then.
The three countries, which generally export around 6 million tonnes of rubber each year and account for 70 percent of global output, had expected prices to pick up for seasonal reasons. The Thai Rubber Association, has forecast Thailand will export 2.8 million tonnes in 2012, up from around 2.7 million in 2011, and the country will produce around 3.15 million tonnes, up from around 3 million. The price of Thailand's benchmark RSS3 export grade rubber hit a record high of $6.40 per kg last February.
Comments
Comments are closed for this article.