Farmers launch stir phase II; Rubber Board warns of price fall
Highlights
Farmer body asks farmers not to go for ‘summer tapping’
Rubber Board exhorts farmers to up tapping to discourage imports
Farmers allege Rubber Board catering to interests of tire-makers
The Kerala rubber farmers have launched the second phase of their agitation to lift the NR prices above INR 200/kg level, after finding that the momentum created in the wake of their first phase of agitation has lost steam, leading to a fall in rubber prices.
The National Confederation of Rubber Producers' Societies (NCRPS), the leading forum of smallholders in Kerala, appealed to Kerala farmers on the eve of the New Year to abandon ‘summer tapping’ as part of the second phase of the rubber farmers' strike and not to sell rubber in the market if fair prices are denied. The Rubber Board, on the other hand, has appealed to farmers to optimize tapping days, lest imports increase, leading to price falls.
Farmers rest trees for longevity
After a meeting of the NCRPS on December 31, 2024, V V Antony, national president of NCRPS, said the organisation has called upon farmers to maintain rubber trees well while reducing production if prices don’t go up.
“If such a strategy is employed, the life of rubber trees can be extended to 35-40 years from the current 15-20 years. So it’s not a losing battle when the Rubber Board hardly does anything to stop the exploitation of farmers by the tiremakers. The biggest weapon in the hands of the rubber farmer is the rubber tree itself. No other farmer can use their crop as a weapon. Rubber farmers should be prepared to use this weapon judiciously,” said Antony.
He said that if the tire companies are not ready to pay a fair price, at the beginning of the next tapping season, the rubber farmers in Kerala will be forced to withdraw from the rain guarding scheme of the Rubber Board, which will bring down production in the next season. The farmers are appalled to see the Rubber Board exhorting farmers to beat lower prices by increasing production, he said.
Source: Indian Rubber Board
Farmers who didn’t rain guard make most of summer tapping
The NCRPS appealed to the Indian Government to export rubber since the global prices are higher than Indian prices. It also appealed to the Kerala Government to procure rubber at a fair price to support farmers.
Babu Joseph, a leader of NCRPS, said that the farmers who did not rain guard last season mainly resort to summer tapping, and they get good yields also during this time. “This will be hit after our call if prices remain low. So, the tire makers will feel the pinch,” he said. Kerala contributes nearly 70% of Indian NR production.
The farmers’ latest move seems to have made some impact on the market in the New Year, with prices slowly lifting and crossing the INR 190/kg levels. As the agitation in the first phase lost momentum from the second week of December, the prices began to decline and hit the lowest of INR 188/kg on December 23 from a high of INR 199/kg, and remained at it till December 28 from where it reached INR 192/kg on December 2 and 3. The Rubber Board reported a marginal correction in the prices on December 4 to INR 191/kg. The latex (60%) prices also jumped from INR 126.80 on December 23 to INR 133.15 on January 2 and 3. The farmers are confident of a rally in the coming days, especially with global prices hovering higher.
“At the current global market prices of block rubber, its imported price will be around INR 220/kg, when duty and handling costs are added. Hence, compared to global prices, the domestic prices of RSS-4 are still tenable for tire makers and there is potential for it to go up further,” said a farmer leader.
Board says prices up now compared to previous years
Meanwhile, in the wake of the NCRPS call, the Indian Rubber Board on Friday (January 3, 2025) came out with an appeal to the farmers not to scale down production, which it said would lead to increased imports of rubber to the country, leading to rubber price falls.
The Rubber Board pointed out that India recorded a 2.1% growth in natural Rubber (NR) production during the last fiscal (2023-24) at 857,000 tons, up from 839,000 tons in the previous year. On the other hand, consumption recorded a significant increase of 4.9% to 1,416,000 tons compared to 1,350,000 tons in the previous year.
“The price of NR has been trending upward, and the price of RSS-4 has reached INR 192 after touching INR 180 on November 1, 2024. In the global scenario also, prices are on the rise. The Bangkok market is showing an increase from INR 186 in mid-November 2024 to around INR 200 at present. The surge in price is attributed to China's stimulus packages, anticipated global monetary easing, and decreased stocks in China, the largest consumer of NR,” the Rubber Board said while making the appeal.
A senior Board official said that over the years, NR prices have shown an increasing trend. Average prices in the Kottayam market for November 2022-23, 2023-24, and 2024-25 were INR 140.39, INR 153.52, and INR 184.85, respectively. Similarly, Bangkok prices were INR 127.25, INR 141.93 and INR 196.16, respectively.
According to the Association of Natural Rubber Producing Countries (ANRPC) data, the production of NR is showing a decreasing trend in the main rubber-producing countries. Thailand's NR production dropped from 4,849,000 tons to 4,686,000 tons from 2019 to 2024. Similarly, production in Indonesia dropped from 3,301,000 tons to 2,516,000 tons and production in Malaysia dropped from 640,000 tons to 340,000 tons during the period, the Indian Rubber Board pointed out.
“This decline in NR production will likely exacerbate global supply constraints, driving prices up in the years to come. This is the right time to engage in tapping, and any shortage of rubber in the domestic market in the coming months may lead to the import of NR and a subsequent fall in price. So, in the present scenario, the Rubber Board encourages all producers to capitalize on the favorable market conditions by engaging in tapping activities and getting maximum yield,” the Rubber Board said.
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