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Thailand And Iran To Start Barter Trade

BANGKOK (TNA) -- Thailand plans to negotiate a barter trade agreement with Iran in the near future.

Thai Industry Minister, Pinij Jarusombat, will raise the matter on his official visit to Iran next month.

Thailand hopes to export Thai sugar to Iran in return for copper and oil from Tehran, the industry minister told journalists here.

Thailand wants to export one million tons of sugar to Iran, under a government to government deal for mutual benefit.

It is expected that the move could push up the price of the sugar on the world market, as Thailand is one of the world's leading sugar exporters.

The world sugar price has already climbed to US$08.84 a pound, from US$07.00 a pound.

The higher sugar price is partly the result of higher demand from India, which has turned from a major sugar exporting country to a sugar importing country due to a recent drought in the country. India has had to import up to four million tons of sugar this year.

Rising world oil prices have also contributed to the increase in the sugar price, as they have boosted demand for molasses which is used to produce alternative fuels, like ethanol and bio-diesel.

The increased world sugar price is likely to benefit Thailand's sugar exports, Mr. Pinij said.

The minister also urged Thailand's parliamentary sugar cane and sugar committee to expedite measures to expand plantations of high-yield sugar cane and to reduce the cost of sugar production.

Mr. Pinij also proposed the setting up of a model organic fertilizer factory, with a budget of around Bt800-900 billion, which will use sugar cane as its raw material.

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