Thursday March 11, 2004 - THE International Rubber Cooperation, set up byMalaysia, Indonesia and Thailand, has decided to sell rubber at a minimumprice of US$1.10 a kilo in the world market.

Primary Industries Minister Datuk Seri Dr Lim Keng Yaik said the threecountries in a tripartite meeting in Bangkok on Tuesday had decided todefend rubber at that price.

Thailand, Indonesia and Malaysia produce 80% of the world's rubber.

Dr Lim said that besides him, the meeting was attended by Thai PrimeMinister Thaksin Shinawatra, Thai Agriculture and Cooperatives MinisterSomsak Thepsuthin, and Indonesian Industry and Trade Minister M. SumarnoSoewandi.

Dr Lim, who is also Gerakan president, said the cooperation would lookinto the means of trading rubber, and its supply and demand to defend theprice of rubber at US$1.10 a kilo.

If need be, the cooperation will build a rubber stockpile to defend theprice, he said yesterday in Kuala Lumpur after meeting potential partycandidates to be fielded in the general election.

We should not undercut each other in the international market, he added.

Dr Lim noted that the cooperation had a paid-up capital of US$300mil todefend the price of rubber at the agreed level.

He added that the price of rubber had been steady at RM5 a kilo over thepast two years.

The cooperation would also establish a supply management scheme andpermissible export tonnage, he said.

On palm oil, he said Malaysia had pledged to help Thailand increase palmoil production and look into downstream activities.

He noted that a joint effort between Malaysia, Indonesia and Japan wouldfocus on converting palm oil into bio-diesel by setting up a plant forthis purpose.

The price of palm oil is currently RM2,000 per tonne.