Serious fall in production ofnatural rubber (NR) during the peakseason (September – February) of the current financial year has raised concern over its domestic availability. Duringpeak season production dropped to 518,000 tonnes as against 546,500 tonnes in the corresponding period in the previousfiscal.
The consumption on the other hand increased by 6,000 tonnes during this period.The extent of drop in NR productioncan be assessed from the fact that the Rubber Board had scaleddown the original production estimate twice during the current fiscal from 9.6 lakh tonnes to 8.7 lakh tonnes and to further down of 8.5 tonnes.
However, even the revised estimate of 8.5 tonnes made as recently as in February is also not likely to be achieved as actualproduction during April-Feb (11 months) period is just 7.8 Lakh tonnes. In Apr-Feb. period of FY 12-13, the productionwas 8.6 Lakh tonnes. So according to industry estimates total production mayconfine to 8.2 -8.3 lakh tonnes only.
Recent data released by Association of Natural RubberProducing Countries (ANRPC)shows that India has slipped down to the fifth spot in production, below Vietnam and China in production, in 2013. India was on the fourth place in 2012after Thailand, Indonesia and Malaysia. India’s position will b much weaker in 2013-14 thanks to the serious drop in production during the peakseason.
Tyre Industry has expressed concern overchronic shortage in domestic availability of natural rubber stretchingthroughout the current fiscal.
“In the past, NR availability duringthe peak production months stretching over six months of Sept-Feb. was not amajor concern. However, during the current fiscal, domestic availabilityeven during the peak production months has been erratic and uncertain,” said Rajiv Budhraja, Director General,Automotive Tyre Manufacturers’ Association (ATMA).
Even though the peak productionseason has just concluded, market availability of rubber has been extremelytight leaving tyre companies with no other option but to import as going forward into the lean season the situation is likely to only worsen, he added. Production is likely to pick up by June in tandem with the arrival of monsoon.
With the expected revival inautomobile sector and resultant demand for tyres improving in FY 14-15, anincrease in NR consumption without a matching increase in Production will onlyincrease Industry’s dependence on import for this critical raw-material.
Source: Business Standard
