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Natural rubber price sees a rising trend

Natural rubber price sees a rising trend2019.05.30

Nearly a month ago, the price of premium grade ribbed smoked sheet (RSS-4) in India was Rs 128 per kg on an average. This has now moved up to Rs 134 per kg. And many analysts think that the price of natural rubber has bounced back and this trend will continue for some time now. Mind you, when it comes to natural rubber (NR) production, the month of May is normally considered to be a lean period. But this time round, there is a tangible spiral of demand for NR from domestic stockists.


Given the bright price prospects, rubber production in the next year's peak season, may go up even further. At least that's what the Indian Rubber Growers Association feels. And not just production, rubber growers expect the price of RSS-4 to go up well above Rs 142 per kg by Mid-June. This is notwithstanding the fact that India's NR production has shrunk, by nearly one-third, from 9 lakh tonne in 2008-2009 to 6.42 lakh tonne, in 2018-19.




Interestingly, the Rubber Board, meanwhile, has set a target of raising domestic production to nine lakh tonne in 2019-2020.The Rubber Board is also working on a package of production incentives, that would win back the confidence of the small farmers, who are the majority in rubber sector. In fact a large section of the rubber growers are already back to replanting of rubber sapling, getting the bounce-back signal. Earlier, thanks to poor price realisation, small holding farmers had even been abandoning tapping operations on their rubber trees.


Some analysts pointed out that arrivals remained weak due to lack of tapping in high temperatures. For instance, supply remained weak as tapping in Kerala's key growing areas has been halted since mid-March due to high temperature which is likely to continue till May-end. And this supply tightness is likely to continue for some time now-- at least for another month or so, analysts said.


Going by the traders' expectations, in the days to come, the price of natural rubber in key markets of Kerala is likely to rise further, thanks to robust demand from stockists amid the ongoing supply crunch in the market.


Source: Asian Age

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