July rubber output rises, imports continue to slip

C.J. Punnathara

Kochi, Aug 4

Production of natural rubber in the country increased close to 15 per cent to 57,500 tonnes in July against 50,250 tonnes in the same period a year ago. Although on a year-on-year basis, consumption has remained more or less stable, it was 35 per cent more than production in July. Consumption for the month was 77,500 tonnes.

The production-consumption difference continued to be wide due to the lower tapping on account of the rains and decreased arrivals, sources in the trade said.

Prices

Imports fell by half to 14,906 tonnes (29,702 tonnes) in July mainly on account of the high international prices. While the gap between domestic and international prices widened to Rs 30, the high customs duty was the principal reason why imports have plunged, sources in the tyre industry pointed out.

The higher domestic prices for natural rubber have proved a disincentive for exports with no shipments taking place in the month.

The reason for the increased production was mainly due to higher soil moisture on account of good rains, sources in the Rubber Board said.

Tapping operations

Anticipating good prices due to decreased arrivals on account of the rains, a large number of farmers have undertaken rain-guarding and, thereby, ensured that tapping operations continued unhindered.

Increased area to the extent of 11,000 hectares has come under tapping this year. Finally, the superior clones such as the 400 series would have come under tapping this year.

Stock position

According to the Rubber Board estimates, the rubber stocks have declined to 1,88,090 tonnes at the end of July as against 2,20,083 tonnes last year.

Tyre companies have been complaining that there are hardly any arrivals at the market despite the high prices.

Although imports had fallen sharply last month, they pointed out the major import season would continue into September, when most of the country's rubber imports are completed.

This year, the high international prices have ensured that imports are not viable at the current high customs rates and there are hardly any arrivals into the market, they said.

(thehindubusinessline.com)