The Rs 45,000 crore non-tyre rubber products market is facing the heat of flooding in Kerala as price of the commodity has shot up by 20 per cent and may soar further impacting the SMEs most, officials said Friday.
"Kerala contributes about 80 per cent to the country's natural rubber production. The flood will affect the (natural rubber) production by about 15 per cent. Natural rubber production in India is around 6 lakh tonnes, while our consumption is around 10 lakh tonnes," All India Rubber Industries Association president Kamal Kishore Chowdhury said.
The shooting prices of natural rubber will impact profitability owing to rising input costs, said Vikram Makar, senior member of the association and chairman of India Rubber Expo 2019.
The expo will be held in January next year in Mumbai.
The yield for natural rubber has been stagnant while consumption has been growing by around 10 per cent annually, they said.
They also said domestic rubber products like tube and tyre for bicycles and rickshaws, conveyor belt and footwear could face threat of losing market to imported finished products.
"We urge the government to rationalise import duty on raw materials in order to make domestic manufacturing competitive. Imported raw materials including natural rubber, attract 20-25 per cent duty while up to 10 per cent duty is imposed on imported finished products, the association said.
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