VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

 Rubber exporters in South Sumatra have a windfall from the rise in the U.S. dollar value against rupiah. Chairman of the South Sumatra branch of the Indonesian Association of Rubber Companies (Gapkindo) Alex K Eddy said in Palembang, South Sumatra Province,  the rubber growers are expected to have a share from the windfall.

"The rise in the dollar value increase the selling price of rubber in term of rupiah that should also benefit the farmers," Alex said here on Wednesday.

He said the falling value of rupiah against the dollar has its positive and negative sides, adding while generally it has brought about economic woes to the country, stronger dollar benefit exporters. The farmers would gain despite weak demand and relatively low price of rubber in international market.

However, Alex said Gapindo wanted the farmers not to hope for too much as the dollar rise is not expected to last long, adding the rupiah would recover and dollar would return to its normal position.

"We could not control the rubber price . The price is dictate by the international market," he said.

Since early 2018, the rubber market remained weak. The price has not improved (in dollar). By 5 September 2018, the rubber price was around US$1.31 per kg - shrinking from around US$1.6 per kg a year earlier.

"Until the quarter of this year the price remained low (in dollar). Development of downstream industry in this sector, therefore, should be accelerated to boost demand for the farmers` rubber," Alex said.

Downstream rubber industry is not only tire factories , but also factories producing furniture and floor material, he said. South Sumatra is the largest contributor to the country`s rubber production. (ant)