India's rubber production inched up by 7 per cent in July 2011 to 62,700 tonnes.

Good climatic conditions, increase in tapped area and soaring prices in April and May are expected to sustain the growth in production into the current month as well, sources in Rubber Board said.

With rains in July being adequate as against the intense spell in June, the weather was more conducive for a better rubber crop this year, facilitating better plant physiology to the rubber trees. The recent spell of high rubber prices has generated increased tapping effort from the farmers, aiding better production.

But consumption has grown at an even faster clip at 7.6 per cent in July to 82,000 tonnes, promising that demand is likely to remain firm into the coming months. With imports spurting to 20,127 tonnes, there was no deficit in the market. Higher imports are a normal feature during the lean months, sources in the trade said.

While demand and consumption from the domestic economy remains robust, high interest rates and slowdown in automobile production could have an impact on domestic rubber demand. However, unlike the post-tsunami days in Japan when global rubber prices plunged sharply, the impacts from the current economic downturn in the US economy has been far more moderate this time, sources in the trade said. The strong growth in the production and supply of rubber during April-July 2011 and relatively steady price line currently are reinforcing this belief.

While production had grown by 5.8 per cent to 2,38,400 tonnes during April-July, consumption has grown by 4.8 per cent to 3,23,875 tonnes. The pace of growth in consumption was at a far higher pace than that in 2010-11 when it had grown by just 1.8 per cent for the whole year. Rubber stock available in the country has grown to 2,47,490 tonnes in July 2011, as against 1,80,958 during the corresponding month of last year.

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