Gapkindo: the rubber sales chain should be cut

Alex K Eddy, Chairman of the Indonesian Rubber Entrepreneurs Association in the South Sumatra Province in Palembang, on Sunday, said that the rubber sales chain from farmers to factories was too long because there could be two to three middlemen. `This is a problem, which is why there is a significant price difference between the price farmers sell their rubber for and the price that factories buy it for,` he said. If the length of the rubber sales chain could be shortened, then at the very least, farmers would be able to sell their rubber for the price that factories buy it for, which is around Rp7000 per kg. Currently, because there are middlemen, farmers are only able to sell their rubber for Rp4000 per kg. `It is not possible to build a factory in the plantation area. The only solution is to fix the road infrastructure because in several plantation areas, you still have to travel by land for 8-9 hours to get to the city (such as from Muarabelitung to Palembang),` he said. Therefore, middlemen are forced to offer low prices because of the high transportation costs. `This is what sometimes causes a dilemma; the farmers themselves do not have vehicles to sell their rubber directly to factories, so they really need middlemen, but sometimes the prices offered by the middlemen are very low.` he said. The global rubber price started to rise in March due to the recovery of the oil price this week. At the beginning of March, it was still under one dollar per kg, but now it has reached 1.3 dollars per kg. Rubber prices at the farmer level have plunged since the middle of last year to around Rp4500 because of low export absorption due to the global economic slowdown. Previously, the Ogan Komering Ilir District Government said they were prepared to assist with funding for residents who wanted to clear their land of rubber trees to turn it into rice fields. This assistance is in response to the wishes of their residents whose incomes have suffered in the last two years because of the fall in the rubber price. (D019/B012)
Editor: Ruslan Burhanihttp://www.antaranews.com/berita/552018/gapkindo-rantai-penjualan-karet-harus-dipotong