03 Nov 2014
ABUJA, BANGKOK, KOCHI(Commodity Online): In a bid to contain the losses incurred due to fall in prices Rubber processors across the world are fast shifting to inter-cropping. The long gestation period of Rubber trees are also a reason behind this apart form poor investments and neglect in the industry.
Intercropping is the practice of growing two or more crops in proximity. The most common objective of intercropping is to produce a greater yield on a given piece of land by making use of resources that would otherwise not be utilised by a single crop.
In Nigeria, farmers plant rubber trees along side banana, cassava and other crops. There are even players that plant rubber trees and practise animal husbandry on the same area, according to Business Day.
In India many small and medium growers have stopped tapping, bringing down September production in September to 60,000 tonnes from 80,000 tonnes in the same period a year ago. Non-remunerative prices and increasing costs of wages and fertilisers are forcing the farmers to abandon tapping.
A supply demand gap is also visible. Consumption had increased 6 per cent during September. Monthly consumption in September was 85,500 tonnes compared to 80,550 tonnes in the same month a year ago, according to the Rubber Board India data.
Bulk imports spurred by the lower price regime in the overseas markets is the major cause of this widening supply-demand gap. During the April-September period of the current financial year, 225,652 tonnes were brought, up from 181,700 tonnes in the same period of last FY, recording an increase of as much as 24 per cent.
Recently Thailand’s National rubber policy committee has given nod to start buying rubber to build stockpiles from October 22. The move from the world’s largest exporter is a bid to boost the prices of the commodity.
The Thai Government’s plan is to bolster prices to at least 60 baht/kg in one or two months. Soon after the target is achieved government may hike the target price further. State-owned Rubber Estate Organization will spend 20b baht in building up stocks; another 10b baht will be allocated to rubber groups to buy rubber sheet.
– Commodity Online
03 Nov 2014