27-04-2024
Farmers in India are facing uncertainty as the price of natural rubber has dropped in both the international and domestic markets. Despite hopes that the previous upward trend would continue due to tight supply, the price has taken a tumble. The domestic price of rubber had been steadily increasing since January of this year, but it has now fallen significantly.
On March 18, the Bangkok price of RSS-4 variety was ₹231 per kg, but it has now plummeted to ₹185 per kg, resulting in a loss of ₹46 per kg. Although the decline in the international market has been sharp, the drop in the domestic market appears to be less steep. In the Kottayam market, the price has fallen from ₹186 per kg in March to ₹180 per kg on Wednesday.
The international price decline can be attributed to various factors, including a shortage of purchases by China. However, recent rainfall in rubber-growing areas of southern and central Kerala has raised hopes of an improvement in the domestic supply situation. Additionally, there is a perception that rubber production may increase in other rubber-producing countries.
To support the rubber industry, the Rubber Board had introduced an incentive of ₹5 per kg for exported sheet rubber between March 15 and June 30. The Board had also established an Export Promotion Council to capitalize on the higher prices in the international market. However, the downward trend in the international market has posed challenges for these efforts. The majority of rubber produced in India is processed and sold as sheet RSS4.
In 2022-23, India produced a total of approximately 8.30 lakh tonnes of rubber, and production is expected to increase in 2023-24.
