Kerala chief minister Oommen Chandy said rubber farmers in the state were now getting highest product price in the world due to the steps initiated by the state government.
Indicating that prices would further improve, Chandy said the price of benchmark grade RSS-4 increased 12 per cent during the last couple of weeks to Rs 130 kg, led by a rise in local procurement by the tyre companies. In the Bangkok international market, rubber quoted at Rs 108 per kg last week.
Taking a cue from the state government’s push to encouragetyre companies to procure rubber through local sources by removing the sales tax, prices have firmed up from December 18. Last Friday, tyre companies procured 2,400 tonnes of rubber from the local markets.
The state was able to convince tyre companies that the fall in rubber price was taking a toll on farmers by making them quit its cultivation.
Due to falling prices in the last three months, rubber production in the state dropped 25 per cent, led by stoppage of tapping.
During November, 2014, production dropped 25 per cent to 64,000 tonne as against 85,300 tonne for the same month in the previous year.
Kerala had witnessed a continuous fall in production since June, 2014. The sharp fall in prices forced farmers to abandon rubber plantations, hence the serious dip in output. On the other hand consumption of rubber increased during last year. During November consumption increased 12 per cent to 85,000 tones. The main sourcing was from the overseas markets, which further intensified the crisis in local market.
– Business Standard
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