Why tap rubber with rates so low at Rs 97 a kg?

KOCHI: Prakash, a small-time rubber grower in his 50s from Ramapuram in the rubber district of Kottayam in Kerala, stopped tapping in his 2-acre estate six months ago as he was making losses. He has skipped tapping the latex in the peak harvest months from October to January, when growers usually earn a significant part of their annual income. “I used to get around 10 kg a day during peak production months. But with the current price, tapping is not viable.If I had invested in rain guards (which allow tapping even when it rains), it would have gone waste.” Rubber prices in India are currently at an eight-year low and, at Rs 97 a kg, below the psychologically key level of Rs 100. Many of the growers have stopped tapping, unable to pay the tappers with the income they are getting.

Rubber production for the nine months through December fell 16% from a year earlier and industry experts have predicted that the Indian rubber output in 2015-16 will fall short of 6 lakh tonnes. The last time when production was below 6 lakh tonnes was 18 years ago. The output had been continuously increasing since then, until last year.

“Surviving the next three months, usually the lean months for tapping, will be quite difficult as we have to pay revised wages and bonus with retrospective effect,” said C Vinayaraghavan, CEO of Harrisons Malayalam.