General Characteristics
Natural Rubber (NR) is produced from latex or field
coagulam obtained from rubber trees planted in plantations.
The most important forms in which NR is processed and
marketed are the following: Sheets, Crepes, Block rubber
and Preserved Latex Concentrates. In India sheet rubber
designated as RSS 1, RSS 2, RSS 3, RSS 4, RSS 5 are
the most commonly produced and marketed. Block Rubber
is designated in the grades of ISNR.
Global Scenario
- Thailand, Indonesia, India, China, Malaysia, Vietnam
are the major producers of rubber in the World.
- The global production fluctuates between 6-8 million
tons, with a production of 7.9 million tons in 2003,
of which Asian countries have produced 6.76 million
tons.
- On the consumption front, global NR consumption
is 7.89 million tons in 2003, of which 1.9 million
ton was consumed in India and China alone. The total
synthetic rubber consumption in 2003 was 1.13 million
ton.
- Around 60 % of the global rubber production is
used by the transportation sector. In this sector,
natural or synthetic rubber cannot be used individually
and has to be blended.
Major World Markets
Tokyo Commodity Exchange, Singapore Commodity Exchange,
Osaka Mercantile Exchange are the major exchanges undertaking
futures trading of rubber. Kuala Lampur, London, New
York are the major physical markets.
Indian Scenario
- India's rubber production in India is around 6-7
lakh tons.
- Kerala accounts for 90% of India's rubber production.
The other producer is Karnataka.
- RSS (Ribbed Smoked Sheets) account for 72% of
the production and 45% of the imports. Block Rubber
accounts for 10% of the production and 40% of the
imports.
- The tyre industry, consumes 52 % of the almost
7 lakh rubber produced in the country.
- Tyre is the major form in which rubber is exported
from India. India's tyre exports are around Rs. 1200-1300
crores a year. Duty-free imports against the advance
licence scheme is permitted for re-export and rules
mandate that only 44 kg of natural rubber can be
imported against 100 kg of exports. India's imports
vary between years and is currently around 50000-60000
tons a year. Duty-paid imports of natural rubber
under open general license attract 20 % import duty.
Major World Markets
Kottayam, Kochi, Kozhikode and Kannur in Kerala are the
major primary markets.
Daily Price Volatility of RSS 4 Grade Rubber at Kottayam
in 2002-2004
Daily
% Volatility |
< 1 |
1
- 3 |
> 3 |
% Occurrence |
78.95 |
19.74 |
1.32 |
Market Influencing Factors
- The rubber production fluctuates between months
and it is normally low during the rainy season.
- Growth in industrial production: automobile industry.
- The ratio of utilization of domestic production
and imported rubber by tyre manufacturers.
- Government policies have a profound influence
on rubber prices. These include subsidies, restrictions
on ports etc.
- International rubber price movements, have a slow
influence.
- Stockists and speculators also play a significant
role in influencing prices.
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