Rubber Prices Lowest Since 95

Natural rubber prices have fallen to the lowest level since 1995, according to traders. The RSS 4 grade was traded at Rs 26 per kg and lot varieties (RSS 5 and other lower grades) were traded between Rs 24 and Rs 25. A year ago, the price for RSS 4 grade was Rs 27.75 per kg.

According to market sources, the heavy stock of rubber has created a glut in the market. The result: the steep fall in rubber prices.

Due to favourable climatic conditions, production is in full swing and on an average 3,000 tonne of rubber is being produced daily. But the offtake from the industrial sector is far lower, leading to more stocks being piled up.

Both the Centre's and the state government's interventions failed to have any impact on the market. The state government through its agencies is procuring rubber, but only in a small quantity, which cannot control the market forces.

The proposal for export of rubber has not materialised so far due to low international prices.

Rubber prices have been falling over the last few years. During 1994-95, the average price was Rs 36 per kg, which improved to Rs 52 in 1995-96. But the prices continued to fall over the next few years and was Rs 31 during 1990-00 and 2000-01.

Market sources expect a further fall in the price level. The nine lakh plus natural rubber growers in the state are in doldrums due to the consistent fall in the price level.