India rules out duty-cut for rubber imports

Only import duty cap: Rubber Board chief

Staff Reporter
KOTTAYAM: Rubber Board chairman Sajen Peter says that the Union Commerce Ministry has ruled out any cut in the import duty of natural rubber from the present 20 per cent.

Mr. Peter said here on Wednesday that the assurance was given by Union Commerce Minister Anand Sharma to a group of MPs from Kerala who met him in the morning.

According to him, in the case of import duty, the Union government will be implementing the recommendations of an expert panel constituted by the government on a directive of the Delhi High Court to look into the demands raised in a petition filed by organisations representing rubber consuming industries.

The expert committee had made a recommendation to retain the import duty at 20 per cent, but to fix a ceiling of Rs. 20.46 a kg.

The panel had arrived at this figure considering the average price of natural rubber during the past three years, which is Rs.102.32 a kg. According to Mr. Peter, the Minister said the import duty cap would be allowed in a phased manner, in lots of 25,000 tonnes.

The expert committee had finalised its recommendations after hearing the views of organisations representing growers. These recommendations were welcomed by a meeting of the Rubber Board on July 31.The natural rubber consuming industry had approached the Delhi High Court on the import duty issue in the light of the soaring prices in the internal and international markets.

In the internal market, prices had touched a whopping Rs.186 a kg during the first week of August, forcing the consuming industry to shell out up to Rs. 37.20 a kg as import duty which remained at 20 per cent.

This had also upset the price integration of natural rubber in the internal and international markets.

Earlier reports of the Commerce Ministry slashing the import duty to 7.5 per cent had created panic in the internal market, which witnessed a steep fall in the price of natural rubber, generating sharp reactions from political parties, especially the Left and Kerala Congress factions.

Meanwhile, Kerala Congress(M) leader Jose K. Mani, MP, said his party was not satisfied with the new decision by the Commerce Ministry and that there was no need to put a cap on import duty.




India rules out duty-cut for rubber imports


KOTTAYAM (Commodity Online): In a major development in the domestic rubber industry, the Union Minister for Commerce and Industry today informed that there would not be any cut in the import duty of natural rubber imports, as had been demanded by the rubber consumer lobby.

The Rubber Board Chairman, Sajen Peter maintained that the Union Minister for Commerce & Industry Anand Sharma has ruled out any cut in the import duty of rubber from the present 20%.

The minister has given this assurance to a team of MPs from Kerala, who visited him this morning. He also said that, in the case of import duty, the government would be implementing the recommendation of the expert panel constituted under the directive of Delhi High Court to look into the demands raised in a petition by rubber consuming organizations, Peter informed in a statement issued today.

The rubber users had been demanding import duty relaxation in the wake of stiff supply constraints in the domestic markets. This led to an exorbitant price rise in natural rubber in a short span of time.

The expert panel had recommended that the import duty be retained at 20%, but a maximum ceiling of Rs.20.46 be fixed, which is based on the average domestic price of rubber for the last three fiscals. The recommendation was made by the expert panel after hearing the views of the organizations and submissions by grower organisations.

This recommendation was welcomed by the Rubber Board in its meeting held on 31 July 2010.

The Union Minister, in a meeting, where Rahul Khullar, Commerce Secretary and Mr. Sajen Peter, Rubber Board Chairman were also present, maintained that import with the duty cap would be allowed only in a phased manner, in lots of 25,000 tonnes.





No shortage of natural rubber

Staff Reporter
Rubber Board projects closing stock of 1.89 lakh tonnes
Figures show rise in rubber production

Consumption up by 6.8 per cent

KOCHI: The Rubber Board predicts that though there will be a production-consumption gap of 85,000 tonnes of natural rubber (NR) during the current financial year, there will be no shortage of the commodity in the domestic market as the opening stock for 2010-11 was 2.53 lakh tonnes compared to 1.96 lakh tonnes during 2009-10.

The projected closing stock of 2010-11 is 1.89 lakh tonnes.

The Board also projects that natural rubber production in the country will be in the range of 8.93 lakh tonnes during 2010-11 compared to 8.31 lakh tonnes during 2009-10.

Provisional figures show natural rubber production during April-July period as 2.23 lakh tonnes, up 6.5 per cent compared to the same period last financial year. Natural rubber production during 2009-10 was lower by 3.8 per cent compared to 2008-09, largely due to adverse weather conditions, growing stock of old plantations and intense harvesting in 2008.

Rubber import

Rubber import for the period between April and July this year has been provisionally put at more than 48,000 tonnes, whereas during the whole of 2009-10 natural rubber import was 1.76 lakh tonnes. It is estimated that imports will be around 70,000 tonnes for the whole of 2010-11.

It has also been projected that there will be a stock of 1.89 lakh tonnes at the end of 2010-11 compared to the carryover stock of 2.53 lakh tonnes at the end of the last financial year.

Consumption of NR in the country went up by 6.8 per cent during the last financial year compared to 2008-09. The projected NR consumption for the current year is 9.78 lakh tonnes and consumption went up 3.3 per cent during the April-July period this year.

Automotive industry's use of natural rubber grew 5.4 per cent between April and July this year compared to the same period last year. Tyre production in the country grew by 33 per cent during the same period. Non-tyre sector showed a decline in use by 0.3 per cent during the period.

The Rubber Board figures also say that export of NR during April-July 2010 amounted to 4,335 tonnes as compared to 926 tonnes during the same period last year.



Spot rubber improves on covering purchases
Aravindan

Kottayam, Aug 25

Spot rubber improved on Wednesday. The market gained further strength on the information that the Union Minister for Commerce and Industry has ruled out any cut in import duty of rubber from the present 20 per cent. Sheet rubber firmed up to Rs 173.50 from Rs 173 a kg mainly on covering purchases. The Rubber Board's rate was steady at Rs 173 a kg for RSS 4. There were no quantity buyers on any grade as the market remained in a holiday mood being Sri Narayana Guru Jayanthi.

Futures firm

The September series closed at Rs 172.53 (172.24), October at Rs 166.55 (167.10), November at Rs 165.79 (165.48) and December at Rs 165.52 (166.01) a kg for RSS 4 on National Multi Commodity Exchange (NMCE). The volumes totalled 8506 lots and turnover Rs 146.23 crore. The open interest in all series was 4,363 lots. The August futures for RSS 3 expired at ¥338.3/Rs 187.73 (¥328.2) a kg while the September futures slipped to ¥304.5 (¥305.7) during the day session and then improved to ¥309 during the night session on Tokyo Commodity Exchange (TOCOM). RSS 3 (spot) moved down to Rs 155.92 (156.27) a kg at Bangkok.

Spot rates were (Rs/kg): RSS-4: 173.50 (173); RSS-5: 164 (163.50); ungraded: 158 (157.50); ISNR 20: 151 (150) and latex 60 per cent: 112 (112).


Anand Sharma rules out cut in import duty on rubber


Kottayam, Aug 25

The Union Minister for Commerce and Industry, Mr Anand Sharma, has ruled out cut in the import duty on rubber from 20 per cent, said Mr Sajen Peter, Chairman of the Rubber Board.

The Minister gave this assurance to a team of MPs from Kerala that called on him this morning.

EXPERT PANEL

However, he said that the Government would be implementing the recommendations of the expert panel constituted under the directive of the Delhi High Court to look into the demands raised in a petition by rubber consuming organisations.

The expert panel had recommended that the import duty be retained at 20 per cent, but a maximum ceiling of Rs 20.46 be fixed which is based on the average domestic price of rubber during the last three financial years.

The recommendation was made by the expert panel after hearing the views of the organisations and submissions by grower organisations.

This recommendation was welcomed by the Rubber Board meeting held on July 31.

PHASED MANNER

The Minister also said that import with the duty cap would be allowed only in a phased manner in lots of 25,000 tonnes.

Dr Rahul Khullar, Union Commerce Secretary, and Mr Sajen Peter, Rubber Board Chairman, too attended the meeting with the Commerce Minister.