ERJ staff report (DS)
Qingdao, China -- Indonesia expects to defend a minimum price level of $4 / kg, according to an official statement from the International Rubber Consortium (IRCo). IRCo said, "This followed Thai Deputy Prime Minister Suthep Thaugsuban's pledge on Monday to maintain local rubber prices at no less than THB120 a kilogram ($3.96)."
International Rubber Consortium acting Chief Executive Yium Tavarolit said Thursday that its three member countries (Thailand, Indonesia and Malaysia)have agreed to work together on any potential price control measures, which could include export suspension below a certain price level.
Yium said Tuesday that the three countries would meet this week to discuss measures to stem falling prices, but that meeting is now on hold as prices have recovered somewhat and as the Thai authorities hold their own meeting first.
IRCo said Wednesday it is also setting up a joint working group with the China Rubber Industry Association to counter price volatility. China is the world's largest consumer and importer of the commodity.
Tocom rubber prices hit a record high of Y535.7/kg on Feb. 18 before sliding sharply, as market sentiment was damped by geopolitical tensions in the Middle East, tightening fears in China and the earthquake and tsunami in Japan, despite the fact that major producing countries are in the low-production season. ERJ also published a blog suggesting market manipulation on 18 Feb.
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