VIETNAM’S Ministry of Agriculture and Rural Development is interested in collaborating with the International Tripartite Rubber Council and International Rubber Consortium to develop a regional spot/physical natural rubber market and the Asean Rubber Council to stabilise rubber prices for the long term.
The spot/physical natural rubber market is a real market involved in delivery of rubber to buyers. This is different from commodity or futures markets and where delivery is only 10 per cent of total trade value, but they have an impact directly on rubber prices in the market.
“We see a collaboration of Thailand, Malaysia and Indonesia to develop a rubber market from a buyers’ market to a producers’ market. This is a part to sustain natural rubber prices for the long term,” Vietnam Agriculture Minister Cao Duc Phat said yesterday in an interview with The Nation after meeting Petipong Pungbun na Ayudhya, Thailand’s minister of agriculture and cooperatives.
The International Tripartite Rubber Council (ITRC) and International Rubber Consortium (IRCo) were established by three countries in Asean – Thailand, Malaysia and Indonesia – that produced 7.7 million tonnes of rubber, or 64 per cent of 12 million tonnes globally last year.
Combined with Vietnam’s production capacity of 900,000 tonnes, they account for 70 per cent of global rubber products.
Cao Duc Phat said his ministry will join the technical meeting to set up the regional spot/physical natural rubber market in Bangkok on April 1, then will study how to join the council.
Since rubber prices have dropped since 2013, the country has a policy to cut rubber output by reducing the frequency to produce natural rubber, reducing land to grow rubber trees and encouraging its farmers to change to crops to replace rubber trees.
“Our goal is to reduce rubber output at a time when rubber prices are still dropping, but we can’t target by how much. That depends on the farmers,” he said.
Petipong said in an interview with The Nation that the meeting with Vietnam’s minister had achieved three objectives – Vietnam will collaborate with the ITRC and IRCo to develop the spot/physical natural rubber market, they will negotiate to harmonise sanitary and phytosanitary standards, especially for fruit products before the Asean Economic Community takes effect in December, and share the success of public-private partnerships in agriculture products.
Vietnam will send a team to Thailand before April 10 to discuss the details of products under SPS harmonisation with the goal to finalise everything before the AEC.
Under the PPP scheme, global firms and farmers share knowledge, financial support and business risk to develop agriculture plants. The global firms joining this programme in Vietnam include Unilever and Nestle. This is the programme suggested by the World Economic Forum, which began in Vietnam in 2010.
“We learn what the key to success is and how to adapt it to use in Thailand because this is a part of creating sustainable income for Thai farmers,” he said.
Cao Duc Phat said that since Vietnam kicked off PPP in the country and also started the Grow Asia campaign in 2010, its agricultural revenue has risen on average 3 per cent a year and costs have decreased by an average 2 per cent a year.
Vietnam is one of four countries joining the Grow Asia project. The others are Indonesia, Myanmar and the Philippines.
– nationmultimedia.com
