A sharp fall in natural rubber prices is causing concern in Kerala, which accounts for over 80 per cent of the domestic production of the commodity.
Farmers, local traders, and political parties hold the steady increase in import of rubber by the industry tapping on low tariff rate as the main factor for the declining prices for the domestic output.
According to Jose K. Mani, MP, the Centre is yet to fulfil its promise of raising the import tariff from 20 per cent. The Finance Ministry was yet to give its nod to this proposal forwarded by the Commerce Ministry on pressure from Kerala, he said.
The growers, many of them medium and small holders, were also hit by the hike in input cost, especially the wages, and factors such as rotting of trees due to excessive rain and paucity of experienced tappers.
The farmers, who mostly route their output through local traders, said the actual price they received was less than the official estimates.
“Last week alone the price fell by Rs.30 a kg, which is the severest in recent times,” a farmer said. The plummeting prices have left a telling impact in Kottayam, Idukki, and Pathanamthitta districts, which have the largest concentration of small and marginal rubber growers apart from several big and medium sized plantations.
According to the Rubber Board, the domestic price of RSS-4 slipped to Rs.15,900 last week from Rs.18,113 a quintal.
Many of the farmers are apprehensive that if the import continued at the current level, the prices will dip further.
Local dealers said that it had often been the practice of the industry to manipulate the domestic prices by increasing import during the peak yielding season of October-December.
Political parties and farmers’ outfits alleged the present situation was the result of the Centre going back on the promise of enhancing the import tariff to stave off the price crash. Farmers said that there had been a mismatch between the input cost and the price they fetched.
“The wage for tappers was fixed when the rubber price was at its peak. While the price has come down since but the labour cost remains the same,” said another rubber cultivator. The excess rainfall received in the rubber growing areas in the State this year has also added to the distress of the farmers in the form of large-scale rotting of trees, they said.