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The rubber and tyre industry has asked the government to keep strategic reserve of natural rubber under a policy framework to meet exigencies.
“The move by the Kerala government vindicates our long-standing request for a buffer stock of NR so as to minimise the vagaries of sharp volatility in prices, as witnessed in the last few years. However, a strategic reserve of NR should be a part of an institutional framework,” said Rajiv Budhraja, director general, Automotive Tyre Manufacturers Association (ATMA).
Chief minister Oommen Chandy recently said that the government was looking to procure rubber from the open market as the price had dropped sharply in last couple of months.
In a communication to the Ministry of Commerce & Industry, the ATMA had stated extreme price volatility needed to be minimised through creation of a ‘buffer stock’ or ‘strategic reserve’ of 15 days requirement. This would take care of managing imports at the time of shortfall in domestic NR production as well as discourage panic selling by the growers when prices are declining.
According to it, China already has such a 'strategic reserve' to manage demand-supply imbalances and price volatility.
However, the department of commerce declined to have a strategic reserve stating, “It has been decided that there appears no need to set up a strategic reserve”.
Niraj Thakkar, president, All India Rubber Industries Association, said all the key issues and concerns of rubber stakeholders needed to be addressed on priority. "To address these issues, we have suggested for preparation of a national rubber policy and are already in touch with the Rubber Board and the government for working out its contours.”
