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 Indian 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
|
|
|
Markets 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.
|
|