Rubber Board announces an export incentive to grow Kerala’s local market

The Rubber Board has unveiled a new incentive program for the export of sheet rubber, with the goal of increasing the price of natural rubber domestically. Exporters of sheet rubber will get an incentive of ~5 per kilogram under this plan. The period of this initiative’s implementation is March 15–June 30. The declaration was made on Friday at an exporters’ meeting at the Board’s headquarters.

The impetus for the conference came from farmers’ increasing demands for market intervention, given that local rubber prices have not increased much despite increases in overseas prices. The Board formed an Export Promotion Cell to help with a range of concerns and to support exporters even further.

To be eligible for the incentive program, eligible exporters must possess a current Registration-Membership Certificate issued by the Board and be registered to use the Indian Natural Rubber Logo. When the necessary paperwork is submitted and the branding expenses are covered, the Board will pay exporters back.

Nonetheless, a few farmers have voiced their displeasure with the Rs 5 export incentive. The National Consortium of Rubber Producers’ Societies’ general secretary, Babu Joseph, said that providing a mere Rs 5 subsidy would not appreciably boost exports. According to his suggestion, genuine market involvement would include the Central and state governments purchasing rubber at a premium for the purpose of export.

According to the terms of the export incentive programme, an exporter is eligible for a subsidy of up to 40 tons, or up to Rs 2,00,000. Furthermore, this incentive is exclusive to 50 exporters. The federal and state governments should pay more for sheet rubber that they purchase directly from the market in order to bring local costs into line with global prices. The local rubber price won’t accurately reflect worldwide patterns until then, he said.

A laborer at Perambra Plantation tapping rubber.
Kerala: Rubber Board would look at export opportunities to boost home market
A laborer at Perambra Plantation tapping rubber.
Rigid local pricing encourages requests for exporting rubber
International prices for sheet rubber have surpassed Indian prices since January 2024.

Exporters are having trouble selling despite this price differential since lower price quotations from nations like Vietnam make exporting difficult. Only 10% of sheet rubber is used worldwide; China, Malaysia, and Sri Lanka are the three biggest users. The fact that these countries have long-term commitments for the purchase of sheet rubber has prevented Indian exports.

The ambition of the exporting community to obtain export orders and follow global market trends has resulted in a recent spike in Indian pricing.

To address these issues, the Rubber Board held meetings under the direction of its chairman, Dr. Sawar Dhanania, executive director M Vasanthagesan, and member N Hari.

An employee harvesting rubber at Perambra Plantation. The Center increases funding for the rubber industry by 23% to Rs 708 crore.