Rubber producers support the agreement of the three major commodity-producing countries to return to the Agreed Export Tonnage Scheme.
Chairman of the Indonesian Rubber Producers Association (Gapkindo) Moenardji Soedargo said entrepreneurs fully support the export cuts that will be taken by Indonesia, Malaysia and Thailand in December 2017. According to him, the policy is needed to restore the price of rubber in line.
"Gapkindo always support the same action in the form of export cuts when the price is out of the rail and dangerous," he told Bisnis on Monday (04/12/2017).
Moenardji explained that export cuts have been conducted four times by three producer countries that are included in the International Tripartite Rubber Council (ITRC). The move is a short-term solution to bringing back the price of rubber commodities in the global market.
In the near future, he continued, the government in three countries will explain in more detail about the export cuts scheme that will be applied. It concerns the total amount of export cuts and the time period for the implementation of the policy.
Nevertheless, he expressed optimism that export cuts could again boost rubber prices in global markets.
"I think the price could hold close to 200 yen per kilogram in a few months," he explained.
As is known, Gapkindo installed rubber export target of 2.7 million tons in 2017 or up from the realization in 2016 of 2.6 million tons. Meanwhile, production is targeted to reach 3.2 million tons this year.
Based on Bloomberg data, the price of rubber throughout the year has been steadily declining since reaching its peak at 351.4 yen per kilogram (kg) in February 2017. In early December 2017, prices stood at 203.5 yen / kg.
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