Prices dragged down by accumulated oversupply of rubber stocks

BANGKOK, December 7 (TNA) - A recent research of Thailand-based Kasetsart University has found that a drop in the prices of natural rubber currently has been caused by accumulated global oversupply of rubber stocks over the past six years. Thai Agriculture and Cooperatives Minister Grisada Boonrach told journalists of the research result on Friday, citing as an example the total supply of world natural rubber in 2018 that stands at about 14.45 million tons against the total world demand of the product at about 13.92 million tons. Grisada said the research project has also found that the accumulated global oversupply of natural rubber has reached about 4.66 million tons since 2012. The minister quoted the research project as suggesting that in case of Thailand, the prices of natural rubber could rise by 9-13 baht per kilogram, from 41 baht per kilogram acceptable by local growers, if the demand for the product increased by one million tons, or the supply dropped by one million tons. To reduce the supply of natural rubber, the minister acknowledged the research project has recommended that areas of less or unproductive rubber plantations in Thailand be changed for growing other economic crops, or for raising livestocks or for running the fishery business instead through offering incentives for rubber growers in the areas. The minister indicated the reseach project has also recommended that the Agri-Map be used to figure out appropriate areas for productive natual rubber plantations, as updated statistics, released by his ministry's Land Development Department, have shown that there are now up to almost 5 million rai of less or unproductive natural rubber plantations in Thailand (2.5 rai = 1 acre), and that such more popular varieties of natural rubber as Guayule and Russian Dandelion be grown more widely in the country to serve the global tyre manufacturing industry. Besides, furniture producers in the country should be offered tax or other incentives to use more locally-grown natural rubber as their raw materials in place of their imported materials. (TNA)