Natural rubber just hit a record Rs.253 per kg, with some deals in Kerala's Kottayam market going up to Rs.260. The main reasons? Extreme weather, not enough rain, and production slowdowns in Southeast Asia. George Valy from the Indian Rubber Dealers Federation explained that tensions in West Asia and weather-related factors are also pushing prices up, while traders pointed to steady industrial demand. Heat reduces tapping in India With global rubber rates now at Rs.288 per kg, India's market is feeling the squeeze. Local production dipped earlier this year because high temperatures made tapping tough. Some farmers are holding onto their stock hoping for even better prices, but they risk losing quality if they wait too long. On the bright side, tapping has expanded into previously untapped areas; recent rains could boost supply soon, and Kerala farmers are optimistic about higher yields as the monsoon approaches.
In sync with global trend Traders pointed out that the rising prices in the domestic market are in tandem with the upward trend in global prices, which is ruling at Rs.288 per kg.
The prices have been consistently high due to supply shortages and sustained industrial demand, which is supporting the upward trend. Tapping has stopped in major producing areas, reducing supply. High oil prices and disruptions in South-East Asian production have driven international prices up, further impacting domestic rates. There are also reports of farmers holding the stock in view of the rising prices, he said adding that they could not hold it for long as it affect the quality of the raw material.
There was a pause in production during Feb-March-April months as the rising temperature hit tapping in a big way. With the United Democratic Front coming to power in Kerala in the elections, the farming community is now pinning their hopes on the floor price announced for natural rubber in the election manifest at Rs.250 per kg.
They are also hopeful that the present rains and the imminent southwest monsoon by mid-May are expected to increase the yield in the current season.