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Weak tapping, global rally lift domestic rubber price

Price of sheet rubber variety RSS-4 used in tyre now at Rs 130.50/kg.

, ET Bureau|
Nov 29, 2019, 11.44 AM IST
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“Rains kept away in the last week and tapping has begun. Maybe we will see more arrivals in the next two months,” said George Valy, a rubber dealer based in Kottayam.
Kochi: Weak tapping and a price rally in the global market have pushed up domestic natural rubber prices 4 per cent in November, although it is the peak tapping season.

The price of sheet rubber variety RSS-4 used in tyre manufacture reached Rs 130.50 per kg on Thursday, indicating a decline in arrivals in the market as continuing rains prevented growers from going for intensive tapping in Kerala, the largest rubber producing state in the country.

“Rains kept away in the last week and tapping has begun. Maybe we will see more arrivals in the next two months,” said George Valy, a rubber dealer based in Kottayam.

Valy said a slowdown in demand continues to worry the industry. “Unless consumption increases, we may see a downturn in prices when arrivals rise,” he said.

Even at current price, many growers are reluctant to tap. “Around 30 per cent of the estates in Kerala are still lying untapped. The Rubber Board had recently taken an initiative to adopt underutilised plantations to begin tapping. But that constitutes a small percentage only,” said Shajimon Joseph, secretary, Chirakadavu Rubber Producers Society. The subsidy scheme of the Kerala government that provides growers Rs 150 per kg has encouraged around 40 million small growers to resume tapping.

“But most of such growers are those who depend on rubber primarily for income. Those who have a job are still keeping away considering the low price and difficulty in the availability of tappers,” said Joseph. As per the Rubber Board data, production increased 11 per cent year-on-year in April-September. But the board has revised downwards the output projection for the whole year by 3 per cent to 7,30,000 tonnes. International prices have increased 7 per cent in November to about Rs 111 per kg, triggered by the outbreak of fungal disease in Thailand, Indonesia and Malaysia.

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