Latex processers have decided to procure liquid latex from farmer at Rs 7 per kilo less than the price of RSS-4 grade rubber. RSS-4 (Ribbed Smoked Sheet- 4) is selling at Rs 91.25 per kilo this week, with hardly any volatality.
The new price formula for farmgate purchases will be effective soon, according to a meeting of representatives of latex producing units, including a whole slew of private, co-operative-run and Rubber Board-managed companies.
At present, latex buyer has to cough up Rs 97 per kilo for latex DRC (dry rubber content), sources said. This would need additional processing expenditure to the tune of Rs 18 per kilo.
Only on buying latex DRC at Rs 79 per kilo, the latex processing industry can go breakeven.
Part of the loss will be shouldered by the processing industry, the meeting of latex processers in Kottayam on Tuesday, claimed.
Although ungraded rubber has gained marginally on higher demand from non-tyre segment, latex is not enjoying a robust market this week.
The meeting of latex processers also said that once the latex demand mounts, latex price for farmers may be revised.