Rubber market prices surges on high demand
Sri Lanka’s rubber market has been experiencing a sudden surge in prices as a result of the drop in production that has led to severe competition for the product in the global market.
There has been a drop in production due to the rainy weather in the rubber growing areas and exporters of Crepe rubber are finding it difficult to get the quantities in demand, and as a result there is a severe competition for the rubber, Pussellawa Plantations CEO Manoj Udugampola told The Sunday Times Business. He is also the immediate Past Chairman of the Colombo Rubber Traders Association (CRTA).
It was in October that the industry first experienced a surge in prices at Rs.1100 per kg for the first time in a long time and these prices have held steady upto November as well.
When the rainy months cease then the cropping season will commence and as a result the industry is expected to see an increase in production with prices entering a peak period during this time of year, Mr. Udugampola said. A fair quantity will be available upto mid-February and prices are also expected to prevail at these rates until then. The crop is likely to go down upto May when the defoliation, refoliation and maturity of the leaf happens.
The leaf disease still continues except in the intermediate and dry zone areas namely Kurunegala, Padiyathalawa, Moneragala and Ampara districts.
In the meantime, the new EU regulations on location of rubber lands in the sale of rubber products being a requirement have been postponed by another year as those industries coming under the regulations are finding it difficult to meet the requirements. It is learnt that all rubber producing countries have requested to postpone the date by a year.
In Sri Lanka, Mr. Udugampola said that the companies (RPCs) are geared to meet the requirements and out of the 65 per cent of smallholders only about 20 per cent are ready to market their products under the new regulations.
In this respect, it is expected to give more time for all others to fall line with the new regulations and obtain the necessary documentation and map out the location so as to be able to provide this information to buyers as required by the EU, he noted.
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