Vipin V. Nair

Kochi, Jan. 20

THE Rubber Board on Thursday reiterated that natural rubber production would achieve a seven per cent growth in the current fiscal, but traders and consuming sectors say such an increase is unlikely in the year.

"We don't envisage a major drop in production. Even if there is a drop, it will be very negligible. Rubber production will grow at seven per cent," said Dr A.K. Krishna Kumar, Production Commissioner of the Rubber Board.

However, many in the industry are of the view that production in the current fiscal would grow by only 4-5 per cent over the 7.11 lakh tonnes natural rubber India produced in 2003-04. Last year, production grew by a record 10 per cent.

"Achieving a seven per cent growth over last year's production would be impossible," said Mr N. Radhakrishnan, President of the Cochin Rubber Merchants Association.

He said indications of a lower growth were visible in the previous months as markets often felt shortage of the commodity.

"Even during the peak tapping season, some times there was no adequate supply," Mr Radhakrishnan said.

According to sources in the consuming sector, production might have grown by six per cent during the April-October period, but it was unlikely that a seven per cent growth would be recorded for the full year.

"We expect the production to be only three per cent for the year... may be four per cent at the most," an industry official said.

The Rubber Board is of the view that there wasn't much drop in production even during the monsoons as growers continued to tap, using rain guards, to take advantage of the higher prices prevailed at that time.

Any shortage of rubber experienced could be the result of an insignificant fall in production, Dr Kumar said.

Rubber prices soared to nearly Rs 70 a kg in July 2004, but fell afterwards. During September, benchmark RSS-4 grade touched Rs 50 a kg. Price fluctuations have been marginal since then and currently, RSS-4 trades at Rs 53 a kg.

Dr Kumar said if there was a big drop in production, it would have reflected in rubber prices shooting up. "There is no big change in prices," he said.

Rubber production in the first half of the fiscal was 3.33 lakh tonnes as against 3.13 lakh tonnes in the corresponding period of the previous year.

No official data is available yet for production up to December 2004.

"During the peak tapping season of October-January period, we estimate the production to be 3.30 lakh tonnes. The tapping season is coming to and end now and it is unlikely that the production would touch 7.60 lakh tonnes as projected earlier," Mr Radharkrishnan said.

(This article was published in the Business Line print edition dated January 21, 2005)
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