Fury over rubber prices refuses to subside

By: | Published: January 23, 2016 1:45 AM

Even though the Centre has imposed a ban on free imports of natural rubber (NR), much to the consternation of the tyre industry, rubber farmers are hardly mollified.

Even though the Centre has imposed a ban on free imports of natural rubber (NR), much to the consternation of the tyre industry, rubber farmers are hardly mollified.

Rubber growers have termed the move insufficient and too late. As much as 35% of the total annual production of NR happens in October to December period. Coming after the peak rubber season, there is a feeling that the clamp on duty-free NR imports till March 2016 smacks of tokenism.

“About 12 lakh rubber growers in the small and medium category are affected. By a conservative estimate, there has been revenue loss to the tune of R7,000 crore,” says Sibi Monipally, general secretary, IRGA (Indian Rubber Growers’ Association).

Meanwhile, Kottayam MP Jose K Mani, who is on an indefinite hunger strike seeking to save the rubber farm sector from collapse, has refused to end his fast unless his other major demands for rubber farmers are realised.

His key demands include R500-crore allocation from Central Price Stabilization Fund to grant subsidy to rubber farmers, complete re-hash of the organisational structure of the Rubber Board and tax waiver for farmers till the commodity starts getting a reasonable price.

“If arrested to be hospitalised, I”d continue the strike from the hospital, unless other demands of rubber farmers are also attended to,” Mani told FE. The MP has been on hunger strike for the last five days. His health has been deteriorating, according to medical team, monitoring him.

KM Mani, the supremo of Kerala Congress, has reiterated that there would be no end to the rubber farmers’ agitation, if the price of NR does not revitalise to at least R200 per kg.

The price of rubber has collapsed to below R100 per kg from R243 per kg in 2012. Kerala districts such as Idukki and Kottayam are hub of rubber production in the country.

In a gesture that drew snap furious reactions from rubber industry, the Union government on Thursday had barred duty-free imports of NR till March 31 this year under Advance Authorisations (AA).  “Import of NR will not be allowed during the period 21st January 2016 to 31st March 2016 under Advance Authorisations to be issued or revalidated on or after 21st January, 2016,” DGFT said in a notification.

The lid on NR imports has triggered hue and cry from the industry, both tyre and non-tyre segments. “If the Centre or the Kerala government want to intervene in the plight of rubber growers,  it should be by way of a direct subsidy to them or by efforts to improve their production efficiency, as is done in countries like Thailand, Malaysia, Indonesia or Sri Lanka,” said Mohinder Gupta, president, AIRIA (All India Rubber Industies Association).

Planters demand ban on imports

The United Planters’ Association of Southern India (UPASI) requested the Union government to slap a ban on import of NR through all channels till its price stabilises at remunerative levels.

“Rubber growers are “in grave distress” due the record low price of R98 per kg for the prime grade RSS IV, which is far below the cost of production. The low prices are forcing the farmers to stop tapping or even abandon rubber cultivation, and UPASI is seriously concerned about their plight,” UPASI president N Dharmaraj said.

“Production during April -December 2015 was 4.28 lakh tonne as compared to 5.10 lakh tonne during the corresponding period a year earlier. On the contrary, the imports touched a figure of 3.27 lakh tonne during April-December 2015, accounting for 76 % of the production and 44% of consumption of natural rubber,” he added.

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