15 Billion Baht Loan To Boost Rubber Price

By Jamaluddin Muhammad

BANGKOK, Jan 24 (Bernama) — The Cabinet has approved 15 billion Baht (about RM1.5 billion) interest-free loan in a move to boost the rubber price to 120 Baht per kilogramme.

Newly-appointed Deputy Minister of Agriculture and Cooperative Natthawut Saikua said today the move was aimed at increasing the rubber price from 107 Baht/kg currently.

Deputy Government Spokesman Anusorn Aimsaart said the Agriculture Bank would give a 10 billion Baht loan to rubber estate organisations and five billion Baht loan to cooperatives.

They would buy rubber from smallholders at the rate of 120 Baht/kg, stockpiling them for re-sale when the price goes up in the near future.

Early this month, rubber smallholders demonstrated in some parts of the country, especially in the south, urging government intervention to push up the rubber price.

Some of them even threatened to dump latex in front of the prime minister’s residence if the government failed to address the rubber price issue which was below 100 Baht/kg at that time.

Cooperatives League of Thailand chairman Witoon Naewpanit, in explaining the role of cooperatives in the matter, said with the loan given, the cooperatives would be able to buy rubber from smallholders at 120Baht/kg although the market price was 107Baht/kg.

“We will keep the rubber for a month or two before re-selling them when the price increases,” he said, adding that the current market price should be in the range of 115 Baht/kg and 120 Baht/kg.

However, reasonable rubber price could not be achieved at the moment due to involvement of ‘middle-men’ who buy rubber at a much lower price from smallholders.

With the help of cooperatives and rubber estate organisations, smallholders could sell their rubber directly to them, without going through the ‘middle-men’, he said.

“The cooperatives will be able to absorb losses when they sell their stockpiling rubber at a higher price later, as the current measures will be able to boost the commodity price in the next one or two months, thus enabling them to repay the government loan,” he said.

– BERNAMA

Source: http://www.bernama.com.my/bernama/v6/newsindex.php?id=641922