The recent closure of dozens of sheet rubber curing plants by Thailand's biggest rubber firm, the privately-owned Teck Bee Hang Co Ltd, has provided a wake- up call that it is time to change, they said.

Teck Bee Hang said last week it would close some of its sheet curing plants this week and lay off about 2,000 workers as the company geared toward the production of the more profitable block rubber as a part of a company restructuring.

Industry sources said the country's top 10 rubber firms were in the process of building a lot of new plants to produce block rubber.

According to official data, production of sheet rubber accounts for around 60 per cent of Thailand's total production. Block rubber, latex and others make up for 20, 10 and 10 per cent of the total productionrespectively.

Thailand has projected natural rubber output 2.16 million tonnes this year or about 32 per cent of total world production. More than 80 per cent of Thailand's total rubber output is exported.

Industry sources estimate Thailand's block rubber exports will double within next year.

Thailand exported about 200,000 tonnes of block rubber last year. After all the new plants open, the industry expects exports volume to double to around 400,000 tonnes per year by 1999.

"If I want to keep this business for my young son, I have to extend my operations to produce block rubber too. It is for the security in the long term," said an executive of one rubber firm, which currently produces and exports only sheet rubber.

Choosith Ophaswong, the president of Thai Rubber Association, told Reuters the low prices and lower demand for sheet rubber were the main factors pushing Thai operators to switch to block rubber production even though the country was known as the world's largest RSS3 (Rib-Smoked Sheet)exporter.

"Not only Teck Bee Hang needs to switch to block rubber. Other firms will also gradually close their sheet rubber production lines and produce more block rubber such as STR20 (Standard Thai Rubber) which is in demand," said Choosith.

Although more sheet rubber curing plants are expected to close this year, it is unlikely that sheet rubber will be taken off the production line, industry sources said.

Thailand will still want to maintain its status as the world's major producer of sheet rubber, although the role of sheet rubber in the Thai market will be marginalised.

Moreover, the liquidity crunch facing the country will limit the ability of much of industry to switch to block rubber as only major companies are in the position to make the change.

Smoked sheet rubber is popular among users such as Japan and China while European countries and the United States preferred technically specified -- or block -- rubber.

Although Thailand's major grade RSS3 is considered of high quality, itsquality is not uniform unlike the quality of block rubber which is more consistent.

Handling and transporting block rubber is also easier and much less labour-intensive, industry sources said.