TUARAN, Oct 19 — The proposal to increase the floor price of scrap rubber from the current RM2.50 per kilogramme (kg) to RM3.50 per kg will prevent smallholders from switching to other commodity crops, said Rural Development Minister Datuk Seri Mahdzir Khalid.

He added that if no action were taken, then rubber smallholders would switch to planting other crops with higher prices, especially oil palm, which would then result in the country losing rubber commodity producers.

"Many rubber smallholders have switched to planting oil palm because the price of rubber is low. That is why I support the idea to increase the price of scrap rubber. Although it is difficult, we must find a way.

"If the floor price remains low, the rubber smallholders will switch to planting oil palm trees,” he told reporters after visiting the Sabah Rubber Industry Board (LIGS) SMR Rubber Factory in Tamparuli here today.

On Friday (Oct 15), the media reported that the government had been urged to consider raising the floor price of scrap rubber to RM3.50 per kg beginning next January to help increase the income of rubber tappers to above the poverty level.

Rubber Industry Smallholders Development Authority (Risda) chairman Datuk Mohd Salim Mohd Sharif was quoted as saying that the present floor price of scrap rubber, which is RM2.50 per kg, was far lower than oil palm, which could fetch up to RM1,100 per tonne.

Elaborating, Mahdzir said that apart from the floor price, more space to sell rubber products and expanding rubber plantations were two other important measures that could help rubber smallholders in the country to increase production and, thus, improve their socio-economic status.

He added that LIGS, a state government agency, played a role in helping 80,000 rubber smallholders in Sabah by providing a place to sell rubber products and that LIGS currently has three rubber processing plants in Tamparuli, Tenom and Beaufort.

"The factory in Tamparuli has 300 workers with the capacity to produce 150 tonnes of rubber per day and 50,000 tonnes per year. Apart from the local market, these products are also exported, among them to China for the manufacture of products like tyres,” he said. — Bernama