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Thursday, June 30, 2022

India: Worried over low prices, rubber growers stop tapping

Rubber prices have dropped to levels of ₹120 a kg despite efforts to prevent the downtrend in rubber prices by various stakeholders in the industry.

The Kerala Government’s efforts to drive the market higher have also failed. Various reasons could be attributed to his trend but the general belief is that the domestic price is plunging in tandem with the international price.

Rubber growers had a good time when prices scaled to a record ₹245/kg for the RSS 4 grade. There were times when growers did not release the stock, awaiting further rise in prices. Some were fortunate in getting good prices, as they sold their stocks at the right time.

Panic growers

There are reports from the plantation areas that rubber growers are panicking and will not hesitate to shift to other crops that will be more profitable. Some have stopped tapping.

They are reluctant to continue tapping as returns for them are low even as labour costs remain high. The input costs have also surged.

Natural rubber production dropped in May to 53,000 tonnes from 59,000 tonnes during the corresponding period a year ago.

Rising imports

Though it could have resulted in a price hike, nothing happened as the prices in the international market ruled low. Manufacturers could make use of the opportunity.

Rubber imports, on the other hand, continue unabated. According to reports, China still holds a sizable stockpile. To compensate low productivity, they have extended the area under rubber. They are also producing synthetic rubber on a large-scale.

There should be strict control over imports, demands the Indian Rubber Dealers Federation. As the production season begins shortly, imports of rubber will have to stop.

Since the decision on natural rubber policy is getting delayed, Union and State Governments should intervene, George Valy, President, IRDF, said. The annual conference of the Federation slated on September 27 will discuss the issues in detail.

Action plan

The current replanting subsidy has to be doubled and a price stabilisation scheme introduced without delay, said President of the Forum Kunikoli Moideen and Secretary PP Mohamudkutty.

Rubber growers want only a result-oriented programme to get a remunerative price for their produce, said Prof Devasia, a small grower who champions the cause of fellow farmers in Kannur and surrounding areas.

A time has come to cut down the trees and sell it for firewood as the income realised from the trees is not enough to meet even the cost of inputs.

Many in the plantation sector feel that if there is no end to imports especially at a time when harvesting season is on the cards, an immediate solution to the crisis is difficult.

– The Hindu

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