Kottayam: The Rubber Board under the Ministry of Commerce & Industry, Government of India, has disclosed that owing to price advantage, the export of rubber from the country has picked up momentum during the last two months.
The price of natural rubber (NR) in India had been ruling high over international market prices since December 2013. The price gap between the Indian and international prices came down in the third quarter of 2016. From the second week of November 2016, the international prices of NR shot up and are currently hovering at higher levels compared to Indian prices. The spurt in international rubber price was due to the increased demand for rubber from China, upward trend in crude oil price, appreciation of US dollar, etc.
In India, natural rubber is traditionally not an export commodity and the major share of the rubber produced in the country is consumed domestically. So the response to speculative price movements owing to reasons not specific to domestic market will be relatively less in India as compared to other major NR producing countries. However, the Indian rubber prices generally track international prices and the market invariably adjusts to international prices forthwith, often with a time lag.
According to a press release, Rubber Board is keen in capitalising on the price advantage by promoting export of NR. This would raise domestic NR price to the world market levels. Owing to unattractive relative prices, India’s exports have been negligible since 2013-14. In 2016-17, during April to October period, India’s NR exports were hardly 650 metric tonnes. Exports gained momentum in November – December 2016 and it is expected that India’s NR export may touch around 5,000 tonnes during this year.
Rubber Board has been promoting the brand ‘Indian Natural Rubber’ for exports by which the quality of rubber exported from the country is certified by the Board. Eighty percent of the NR export done so far this fiscal was under this brand. The branding of NR is instrumental in regaining the market share of Indian exporters. Export of NR is an alternative marketing channel and such efforts will help to maintain consistency in the domestic market price.
Kerala Biz News