Representatives from the Ministry of Agriculture and rubber plantations will head to Singapore on Monday to discuss Cambodia’s possible entry into the International Rubber Association, which would provide a boost to the country’s rubber exports, officials said Thursday.
If accepted, Cambodia will be allowed to export to developed countries in Europe and the US, which insist on higher quality rubber than regional markets, said Ly Phalla, director-general of the Agriculture Ministry’s rubber department.
“As we are improving the quality of our rubber production, we want to export to other countries around the world,” he said. “For that we need a certification from the International Rubber Association.”
The International Rubber Association is an intergovernmental regulatory and supervisory body for rubber-exporting nations and currently has 16 member countries.
Cambodia has traditionally exported rubber to its neighboring countries: Vietnam and Thailand. But a recent downturn in its price is urging the country to expand its objectives, said Ly Phalla.
Rubber hit a record high of $3,500 dollars per ton in July last year before gradually falling to $1,300 today, according to the Ministry of Agriculture’s website.
Ly Phalla said that the crisis being experienced by European and US automakers—who use rubber for tires—was responsible for the drop in price but that he expected the market to remain solid for the rest of the year as demand from Vietnam appeared stable.
“The situation is not going to get any better until the world economic crisis is resolved and [US President Barack] Obama carries out his saving policies,” he said.
According to the International Rubber Study Group, an intergovernmental organization based in Singapore, the total global consumption of rubber declined by over 1 million tons in the last quarter of 2008, while the year-on-year growth rate plunged from 2.1 percent to -4.1 percent.
Heng Long, director general of the Long Sreng Rubber Company based in the Kompong Cham Province, said he would be part of the delegation going to Singapore on Monday.
“I cannot predict the result yet, but I expect that the quality of Cambodian rubber will meet the requirements,” he said.
However, he added that his business was suffering from the lack of care and treatment his rubber trees had received in recent years when the plantation was managed by the state. To curb the diminishing quality of his rubber, he has planted new trees on 1,200 hectares of his 73,078-hectare plantation. His trees will take between seven and 10 years to start producing quality rubber, he said.
Ly Hong Sin, director for Tai Seng Rubber Company in Ratanakkiri province, doesn’t think the rubber industry will be back on its feet any time soon.
“I expect that it will take at least two years to boost the rubber price,” he said.
But, he said, Cambodia’s entry to the International Rubber Association would help improve the situation. “It will provide a lot of benefits for Cambodia and my firm,” he said.
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