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17. February 2006

INDIA: High prices lure more growers to plant rubber

Source: Daily "The Hindu Business Line", New Delhi; 17 Feb 2006

Kochi , Feb. 16
The current record-high price is surely inducing more
growers to get into natural rubber plantations. The
Rubber Board estimates that at least 4,500-5,000
hectares of new plantations would have come up during
the current financial year to take the country's total
plantation area to 5.81 lakh hectares.

"The net increase this year would be 3,000 hectares.
Last year we had 5.78 lakh hectares of plantations," a
top official of the Rubber Board said.

He said replanting — replacing old, low-yielding trees
with new plantlets — would have taken place in 5,500
hectares, while new planting is estimated to have
taken place in 4,500 to 5,000 hectares.

"We are witnessing a great enthusiasm in many areas to
plant rubber. Even in the Malabar region, rubber
plantations are coming up in a big way," the official
said. Malabar is not a traditional rubber growing area
in Kerala, as compared to the central and southern
parts of the State.

Natural rubber prices are currently ruling at all-time
high levels. The standard ribbed smoked sheet (RSS) -
3 grade had crossed Rs 82 a kg this month, making
rubber the most lucrative plantation crop in the
country.

The official said in many areas, growers were
prolonging replanting activities, as they want to make
the most out of the present price boom.

However, it takes 6-7 years for the trees to mature
before tapping can be started.

He said growers had also increased the frequency of
tapping to alternate days from once in three days.

All this has led to the possibility of production
exceeding the targeted 7.80 lakh tonnes for the fiscal
2005-06, he said.

During April 2005 to January 2006, rubber production
has grown by 4.5 per cent to 7,00,220 tonnes, up from
6,69,910 tonnes in the same period a year ago. "Even
if we go by the conservative production forecast for
February and March, we will surpass the targeted
production," he said.

In the first half of the fiscal, natural rubber
production grew by a marginal two per cent
year-on-year, leading to scepticism among the trade
that rubber production in 2005-06 may not reach the
projected levels.

However, production picked up afterwards, buoyed by
rising prices and conducive weather in Kerala, which
accounts for over 90 per cent of India's natural
rubber production.

The Rubber Board has forecast that production in
February would be about 41,000 tonnes, and 42,000
months in March. Both the months are lean production
periods as rubber trees start shedding leaves in this
season.

Consumption during April 2005 to January 2006 stood at
6.64 lakh tonnes, recording a six per cent jump over
the corresponding period last year. Exports went up to
55,105 tonnes (41,561 tonnes), where imports came down
to 41,547 tonnes (51,140 tonnes).

Note: 1 lakh=100,000
10 lakh=one million

(Syed Rashid Ali, Karachi, Pakistan)

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