The Rubber Board and the user industry are locked in a dispute over the actual stocks available in the country.

Though there has been a difference of opinion on this for years, it has sharpened this year following record imports during April-November of the current fiscal. The shipments at 2.38 lakh tonnes were more than imports of 2.17 lakh tonnes (lt) for the entire 2012-13 fiscal.

“We had to import rubber because adequate stocks were not available for us during July-September. We told the authorities that stocks were not available before resorting to imports,” said Rajiv Budhraja, Director-General, Automotive Tyre Manufacturers’ Association, the apex body of tyre companies that consume 65 per cent or rubber in the country.

According to Rubber Board Chairperson Sheela Thomas, stocks at the end of November were 2.45 lt.

“Out of this, 77,000 tonnes are with manufacturers; 94,000 tonnes with growers and 74,000 tonnes with dealers and processors,” she said. “There is always a dispute over rubber stocks in the country. It has been there for years because tyre companies say they are not able to get stocks when they want. Growers hold back their produce when prices do not match their expectations. But there is a need for clarity on the stock position since this dispute dates back to late 1990s,” said a trader who did not wish to be identified.

“The Rubber Board could say stocks are with processors or growers. But how can we take stocks reportedly with growers and processors into account? We cannot take into account the rubber that is in processing house,” said Budhraja.

Price crash Imports became contentious since prices that rose to over Rs 195 a kg in August dropped to around Rs 150 earlier this month.

Prices have recovered to some extent, primarily after the Centre revised import duty to 20 per cent or Rs 30 a kg whichever is lower from 20 per cent or Rs 20 a kg (whichever is lower).

During the weekend, RSS-4 grade, that is commonly available in the domestic market, ended at Rs 163.

“It was a fact that, owing to an extended period of rains, the supply of domestic rubber was tight in the last 4-5 months. But the contracted imports landed at the beginning of peak production period and this has exerted a downward pressure on price. The price crash is attributed to various reasons and import is one factor contributing to it,” said the Rubber Board Chairperson.

Rubber imports “Imports have affected growers as well as dealers. In fact, many growers double up as dealers and imports have deprived them of business. Since most of the growers are small farmers, the problem has aggravated,” said George Valy, President of Indian Rubber Dealers Federation.

Small farmers make up over 90 per cent of the total 11 lakh rubber growers in the country.

According to Sheela Thomas, about 65 per cent of the imported rubber was in the form of technically specified rubber or TSR, which is priced relatively lower than RSS4.

“Imports were mainly from countries such as Indonesia and Vietnam where price of rubber is less compared with other rubber producing countries,” she said.

The Rubber Board Chairperson said that despite slight variations rubber statistics maintained by the Board reflected the actual position.

“External agencies appointed to look into the Board’s data also have confirmed our stand,” she said.

Though rubber prices have increased nearly 10 per cent in the last couple of weeks, the revision of Customs duty may not have much impact.

This is because the user industry imports rubber duty free under open general licence against exports of goods such as tyres.

Rubber prices are expected to rule around current levels and be under pressure as supplies are likely to outstrip demand.

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