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ISSUES IN LATEX PROCESSING Santosh Kumar Vice president, Association of Latex processors of Kerala.

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Presentation on theme: "ISSUES IN LATEX PROCESSING Santosh Kumar Vice president, Association of Latex processors of Kerala."— Presentation transcript:

1 ISSUES IN LATEX PROCESSING Santosh Kumar Vice president, Association of Latex processors of Kerala

2 Latex Processing -Statistics Profile of Concentrated Latex Processing Industry in India Total number of latex processing factories: 75 Total installed capacity: 2,35,000 m.tons of DRC Production during 2012-13: 73,150 tonnes of DRC (8.0% of the total quantity of 913,700 tonnes of NR production in India). Capacity utilisation: 31.1 % Domestic consumption: 76,705 tonnes of DRC which is 7.9% of the total quantity of 972,705 tonnes of NR consumed in the country during 2012- 13.

3 Qty (Mt) 2011-122012-13p2013-14p Production764907315068000 Consumption731907670577500 Import1775632378 Export1512770521318 Capacity216000235000 GROWTH AND CURRENT STATUS OF INDIAN LATEX INDUSTRY : Production of centrifuged latex peaked in India from the low level of 6,000 tonnes in 1972 to touch 90,950 tonnes in 2005-06, but came down thereafter to reach the level of 73,150 tonnes in 2012-13 and 68,000 in 2013-14

4 2012-132011-122010-112009-102008-092007-08 Production (Tonnes)73,15076,49076,06585,76088,07088,305 Consumption (Tonnes) 76,70573,19077,38082,51580,52077,715 Closing stock (Tonnes)21,76017,28513,94513,43511,38513,285 DEMAND AND SUPPLY OF LATEX FOR THE NEXT 10 YEARS The domestic consumption pattern of Latex during the last five years shows a mixed picture with slight improved consumption in 2013-14 2013-142014-152015-162016-172017-182019-19 Production (Tonnes)68,00072,08079,28887,21795,940105,530 Consumption (Tonnes)77,50082,15087,07992,30497,842103,713 Based on the past rate of consumption, it is expected that the Latex based industry can grow at the rate of 5 to 6% annually as given below: Since the capacity utilization is very low,the processing industry can meet any increase in demand in the near future.

5 Latex Producers concerns over import of large quantities of NR latex and the resultant impact on domestic price of NR Latex 2011-122012-13p2013-14p 1775632378 IMPORT OF LATEX (Mt) CONCERNS – PROCESSING OR TRADING ? There are 2 basic threats to this industry Import of latex based finished goods from ASEAN nations And China under the inverted Duty structure. Import of Cenex from south East Asian nations through the window of Advanced license scheme.

6 There seems that there are no proper controls on the use of the imported material and its usage by the importer. A good quantity of material is being imported as a cheaper alternative to higher domestic prices and using the long window of export to divert imported material into local market and use favourable price points for Export. MISUSE OF ADVANCE IMPORT LICENSES This leads to -Kills the motivation of local industry to produce -Reduces local prices of produce. - leads to dumping of local markets with international products

7 Present Import structure The present import duty is Rs.49/- or 70% whichever is lower. This is based on 3 points - Adequate processing capability is available in the country. - 40% of the concentrate is water import of material entails import of 40% water at the cost of precious foreign exchange. - A very high farm gate price of field latex (95%) to the grower compared to other forms of Rubber

8 Suggestions We further submit that: 1) there should be a ban on the import of Latex based rubber products which are being manufactured in India 2) latex concentrates are exported on a regular basis, by evolving a mechanism to ensure that such exports can take place even when the domestic prices are higher 3) to encourage and promote latex based small and medium scale units and with Technical, financial and marketing support from the Rubber Board.


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