Labour shortage in rubber plantations is forcing many growers to sell natural rubber (NR) as liquid latex, without the usual value-addition. In tandem with the NR demand, the rate of price escalation in latex is much higher than that of RSS-4 (Ribbed Smoked Sheet).
Although the tapping season is on in full swing, the sheet arrival to the market has not been proportionately catching up, thanks to the emerging parallel latex market. Latex centrifuge facilities and skilled labour are scarce in small farms, in the peak season. And many of the raw material-hungry non-tyre firms have their own centrifuge arrangements.
Latex sells at Rest 61-62 per kilo this week. One may recall that five years ago, this was available at as low as rest 20 per kilo.
Export grade RSS-4, which had traded at Rs 74 per kilo in early July, has its price swinging in the Rs 91 to 93 per kilo band this week.
?Growers have been cautioned not to hoard stocks in anticipation of further price rise,? says Rubber Board Chairman Sajen Peter. ?There are always the market externalities and overconfidence on futures trading to contend with,? he told FE.
The Board has nudged the commerce ministry to take it up with ministry of consumer affairs to cap the fluctuations in rubber futures trading from the present 4% to 2%.
Meanwhile, dealers say that in rubber belts like Poonjar and Kanjirapilli, latex is collected from small scale growers at almost RSS-4 rates. Board has urged to downpeg the latex prices to more realistic rates, much to the ire of the growers.
?It is difficult to accelerate sheet production, since after the era of viral fever, skilled labour has not returned full-fledged to the plantations,? says Josekutty Antony, president, Rubber Nursery Owners Association. Even without the fever issue, rubber farms are facing the issue of second generation tapping labour migrating to non-farm jobs.