Rubber imports fill demand-supply gap

Production was short 88,110 tonnes in April-Jan period

The gap between domestic production and consumption of natural rubber is rising, fuelling a surge in import. Production in the first 10 months (April-January) of this financial year was 723,000 tonnes (it was 798,200 tonnes over the same period a year before); consumption was 811,110 tonnes.

According to Rubber Board data, the shortage is due to a heavy fall in production. In 2013-14, barring the first month (April 2013), output dropped in all others by 10 per cent over a year before, on an average. In January 2014, the latest month for which data is available, production fell 7.9 per cent to 93,000 tonnes as against 101,000 tonnes in the same month of 2013. Normally, production crosses  100,000 tonnes in November, December and January, the peak season for tapping.

Despite the fall in automobile sales, rubber consumption was almost steady during the April-January period. The Board said consumption had a marginal fall of 0.9 per cent. As the supply-demand gap was largely managed through heavy import, there was no significant rise in domestic prices. Total import this financial year is likely to be a record, crossing 300,000 tonnes. It was 279,627 tonnes in April-January, a 43 per cent rise over the same period in 2012-13. Import was a cheaper option for consuming industries as international prices were lower by Rs 15-20 a kg than at home.

Exports were insignificant, with the cumulative figure for April-Januaryat  5,357 tonnes as against 15,632 tonnes in the same period of FY13. The Board says the stock in the country was 272,000 tonnes at the end of January.