The Hindu Business Line : Rubber futures relaunch opposed

Kochi, Dec. 2 Protesting against the resumption of futures trading in rubber, the Cochin Rubber Merchants Association has said futures trading in the commodity will not solve any problems, but will only help to aggravate the miseries of the entire rubber sector.

The Association President, Mr N. Radhakrishnan, pointed out that commodities futures have caused untold miseries to the general trade and industry. The prices of rubber went up from Rs 109/kg to Rs 140/kg after suspension of futures in rubber. The price crash that happened recently has nothing to do with domestic developments, but it is an international problem, he said.

The phenomenal fall in prices has caused severe setback to the million-strong rubber growers. It was high time the Centre took steps to mitigate the miseries of the growers, he said, adding that the Government, as a first step, should impose a ban on duty-free import of rubber. Simultaneously, rubber exports should also be promoted vigorously and the Government immediately announce Rs 10/kg as export incentive, he said.

Rubber being an agricultural produce, the interest rate on bank loans should be reduced to 7 per cent on advances given to rubber farmers and traders. The banks shall be directed to provide ample finance to buy, stock and sell rubber without insisting on collateral etc. Speculative trade should not be allowed to interfere with spot trade, he said.

The association pointed out that global turmoil in the financial markets, mainly due to the recessionary trends in the US, Europe and Japan forced speculators to withdraw from rubber futures world over.

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