Natural rubber prices at record high

Natural rubber prices have set a new record today with RSS-4 sheet rubber price touching Rs 66.50 per kg. Traders said the sharp increase was in sync with the global markets, which were on higher levels since the last two months.

Price of RSS-5 was Rs 61 per kg, while that of ISNR-20 was Rs 59 per kg. The market is, however, facing a major hurdle owing to non-availability of rubber, traders said.

Bangkok market recorded its highest ever rate of Rs 74-75 on Monday. The price spike in Tokyo futures market was, however, not so sharp.

N Radhakrishnan, president, Cochin Rubber Merchants Association, said the global parameters indicate a price of $2 per kg in future since shortage is so acute and it cannot match the increasing demand especially from Japan and China.

Market sources expect a steady level at Rs 84-86 in spot trading in Bangkok.According to information available, drought in Taiwan, Indonesia and Vietnam has affected current year's production.

Taiwan faced a 10 per cent shortfall in production. Total annual production in Taiwan, the largest producer of natural rubber, is 30,00,000 tonne.At present, India is offering lowest price rubber in world market which was not the case a few months back.

Though the paradigm shift in the market has attracted importers, India is not in a position to exploit it owing to a shortage in production. In Kerala, where 92 per cent of the total production is made, June-October is a lean season on account of monsoon.

Growers said production had been badly affected during this season and rain guarding was not effective owing to torrential rains for the last four weeks. Processing is also a big problem and production has been curtailed by 20 per cent in June.

Meanwhile, growers complained that the planned effort of rubber product manufacturers, especially tyre companies, had denied them better prices in line with global market.

A market source, however, said as globally prices are rallying it would have its effect on the local market too in the coming weeks.