The Hindu Business Line : Rubber Board calls for user, grower meet tomorrow — As prices rise, stocks shrink to 9-year low

THE Rubber Board has called a meeting of all stake holders in the rubber industry on June 24 to assess the current situation as prices continue to rule high and stock have touched its lowest in nine years.

The Rubber Board says the meeting is aimed at providing `a platform' for stake holders of the natural rubber sector to discuss the trends in production, consumption, imports, exports, present stock levels and price.

Industry sources say the meeting has been called at the behest of the Automotive Tyre Manufacturers' Association (ATMA) and other consumers who have been demanding, among other things, the removal of export subsidy for rubber to keep the prices in check.

ATMA, sources say, is of the view that the Rubber Board has to convene such a meeting to deliberate on issues created by high rubber prices, since it had held discussions in the past when prices fell.

The RSS 4 grade closed at Rs 66.50 a kg in Kochi on Tuesday. Prices have been soaring as early monsoons affected tapping in Kerala, which accounts for over 90 per cent of the country's natural rubber production.

Tyre makers consume 3.50 lakh tonnes of rubber every year and they have been hit by the rising prices since a Rs 10 increase would translate into an additional expense of Rs 350 crore for them.

Many in the industry do not expect much out the Thursday meeting, which will be attended by representatives of manufacturers, rubber growers, processors, exporters and dealers.

An exporter, who doesn't want to be identified, said ATMA and other consumers could not complain about the prices nor demand for any price band or ceiling since the price of a commodity cannot be dictated.

"Nothing is going to emerge from this. It's going to be a tea and biscuit meeting," he said. ATMA had earlier suggested to the Government that there be a price band with a lower and upper limit.

Natural rubber stocks have come down to the lowest levels in nine years at about 66,000 tonnes. Sources in the Rubber Board said the stock as of May end was between 66,000 and 70,000 tonnes, compared to 1.05 lakh tonnes during the same period last year.

The lowest stock level of 52,270 tonnes was reported in June 1995.