Vietnam has agreed to join Thailand, Malaysia and Indonesia in a regional trading network aimed at shoring up rubber prices.
Vietnamese Agriculture and Rural Development Minister Cao Duc Phat told visiting Agriculture and Agricultural Cooperatives Minister Pitipong Phuengboon Na Ayudhaya in Hanoi last week that Vietnam would participate in a plan to set up an “Asean Rubber Council”, the Saigon Times reported.
Southeast Asian countries needed cooperation to stabilise the rubber market and improve the living conditions of rubber farmers, Mr Cao was quoted as saying.
Thailand has lobbied other rubber-producing countries in the region, including Laos, Cambodia and Myanmar, to form the council. Officials are expected to meet on April 1 to work on the detail.
Thailand has been lobbying its Southeast Asian neighbours since October to join forces to put a floor under rubber prices. In October, industry officials from Thailand, Indonesia, Vietnam, Malaysia and Cambodia and the International Rubber Consortium resolved to improve prices to a fair level for producers and consumers.
In November, Thailand, Indonesia and Malaysia, which produce about 70% of world’s natural rubber, agreed to cut exports from next year to drain supplies, though they still had not decided the amount and timing of the reduction.
Rubber prices hover around 50 baht per kilogramme, a sharp drop from about 150 baht in 2011 due to the glut created by a sluggish world economy.
Former prime minister Thaksin Shinawatra tried to set up a rubber-exporting cartel, but the plan was collapsed due to reluctance from the region’s other rubber-exporting countries.