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As natural rubber prices skid and imports soar, its agitated planters seek safeguards in the form of hike in import or anti-dumping duty to sustain their business in the face of rising production costs and wage increase.
Rubber price (RSS-4 variety) plunged 46 per cent to below Rs 130 per kg in August 2014 from Rs 243 per kg in April 2011, owing to surge in imports from Indonesia and Vietnam, which shot up 37 per cent to 360,287 tonne in the fiscal 2013-14 from 262,751 tonne in 2012-13.
“The rubber industry is doing badly since 2011, as prices have been sliding over the last 40 months. Secondly, imports have not only been rising, but also have seen a shift in sourcing from Indonesia and Vietnam than from Thailand,” said R Sanjith, head of commodities at Upasi told Business Standard.
In terms of variety too, the user industry is seen moving from ribbed smoke sheet (RSS) to technically specified rubber (TSR). Prices of the natural rubber imported from Indonesia and Vietnam, are not known vis-à-vis Thailand, from where it was imported earlier in large quantities.
Even after paying 20 per cent import duty, the commodity’s price is quoted much lower than its domestic variety, resulting in slump for the native rubber.
“We have asked the Centre to slap higher duty or anti-dumping duty to safeguard interests of our growers. We have also asked for revising the standard import and output norm so that they can check imports,” he said.
As a million strong rubber planters are finding it difficult to grow more rubber, Upasi has urged the government to impose safeguard duty to check imports.
According to Upasi, rubber imports have jumped 68 per cent to 100,480 tonne in the first quarter ending June 30, 2014, from 59,933 tonne in the same period last fiscal. Industrial users import SMR-20 grade, which is cheaper in the global market. “If the price decline continues, majority of planters will be forced to abandon rubber cultivation or switch over to other activities. In this background, Upasi wants Centre to impose safeguard duty on natural rubber imports to India,” Sanjith said.
According to early indications, the trend to import will continue, suggesting a plausibility of record imports, he added.
The planters have also asked the government to scrutinise norms in fixing the import quantum under the advance licensing scheme or duty exemption entitlement certificate (DEEC) fixed on the standard input-output norm.
