Faced with a shortage, the All India Rubber Industries Association (AIRIA) is demanding duty-free import of natural rubber and a ban on its trading in futures markets.

In the long term, the AIRIA’s prescription is rationalising import duties such that the burden is more on finished products and less on natural rubber. The rubber body is a 62-year-old outfit having 1,200 members. One of its objectives is to catch up with China by 2020.

There are shortfall fears in natural rubber this year of nearly one lakh tonnes because of excessive rains in Kerala and an outbreak of chikunguniya among the tappers. Kerala’s Idukki, Pathnamthitta, Kottayam and Kolla are the main rubber producing areas in the country.

According to a study by the Rubber Research Institute, there was a shortfall of 50,000 tonnes during the April-August period.

The Rubber Board has estimated a shortfall of 75,000-80,000 tonnes in this fiscal compared with an earlier projection of 3-4 percent growth.

Because of the shortfall, speculators are having a field day in the futures market with prices up 40 per cent over the past four months. According to AIRIA president M. F. Vohra, both the speculators and industry were artificially jacking up prices in the futures market.

“We have written to the government that industry has no qualms on the prices being determined by market forces but was averse to manipulation by a section of futures market operators, Vohra said.

The AIRIA wants rubber to be removed from the commodity list in futures trade.

Mr. Divya Aggarwal

Money Management Consultants Ltd

Senior Copy Editor, Money Management Consultants Ltd
New Delhi, India

Free Member, Joined :05/11/2007
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