Rubberwood imports threaten local market

KOCHI: Rising imports from China and other SE Asian countries is posing a threat to the domestic rubberwood industry , which has so far held steady despite a steep fall in rubber prices.

Price of rubberwood, which is used in the plywood industry and in the manufacture of furniture, has not fallen because of demand from these sectors.

But now, the increased availability of imported rubber wood and furniture is impacting the demand for local products. Furniture made of treated rubber wood has become popular in urban centres.

Rubberwood is priced around Rs 6,000 a tonne in the local market, with good quality wood getting atleast Rs 500 more. "The imports include both treated wood and furniture. They are better in terms of style and finishing as the factories there have latest machines," said Antony John, MD of Metrowood, a leading rubberwood furniture maker. The imports are coming from China, Vietnam and Malaysia, all of which have overtaken India in natural rubber production.

"The products are 10-20 per cent cheaper, which has hit our sales. Our rubberwood is superior in quality," said Jameskutty, MD of Gomma Wood Products, adding several manufacturing units were locked out earlier because of several reasons, including a 5 per cent-purchase tax on rubberwood that was lifted some years ago.

Another factor is sluggish demand in the plywood industry . The Perumbavoor region near Kochi has a large cluster of plywood manufacturing units catering to the demand in southern India as well as n the Gulf markets. This region alone consumes about 7,500 tonnes of rubberwood daily. It was de mand from the ply wood industry that helped prices of rubberwood stay firm in the range of Rs 6,000-6,500 a tonne in the past one year.

"The offtake of plywood has shrunk because of a recession in the construction industry. But rubberwood prices have not dropped because there is over production in plywood sector," said Mujeeb Rahman, president of Saw Mill Owners and Plywood Manufacturers' Association.

Availability of rubberwood in the local market hasn't increased despite the forecast rubber prices are not likely to improve in the next few years, indicating not many growers are willing to chop the trees.