BY Group 1

y INTRODUCTION y MARKETABLE FORM OF RUBBER y INDIAN RUBBER MARKETING SYSTEM y DISTRUBUTION CHANNEL y PROBLEM & CHALLENGES y IMPROVED VALUE CHAIN y SUGGESTION TO IMPROVED VALUE CHAIN y CONCLUSION

Introduction
y India is 3rd largest producer, 4th largest consumer of NR & 5th largest consumer of NR & SR. y With 6000 units with turnover Rs 200 billion contributing Rs 40 billion to national exchequer through taxes & duties. y Presently 0.63 mt of production & project 1 mt in near future. y 98% rubber comes from S.India

contd ..

y Out of which, 94% is from Kerala. y In this dominancy of small holders is 86% & estate

contributes only 14%. y Mostly cultivated in Kerala, Tamilnadu , Karnataka & N. E. Region
y In India NR is a controlled & regulated commodity, as

its production, processing, marketing & consumption is carried out in accordance with statutory provisions.

Marketable Forms of Rubber

Form Share Ribbed Smoked Sheet (RSS) 72.1

Latex Concentrates

10.7

Technically Specified Rubber (TSR)

9.9

Pale Latex Crepe

0.3

Estate Brown Crepe & Others

7.0

Indian Rubber Marketing System

y NR market in India is Oligopsonic in structure y Structure of market for sheet rubber in India basically 3 tier system of dealer y Salient features of NR marketing are y Logical consequences of sectoral & geographical concentrations of production. y Market orientation. y Govt control/intervention in the market. . y Mostly 47% is consumed by automobile industry. y Per capita consumption in India 800gm against 12 14 kg in Europe, Japan & US.

Distribution System By Small Holders

y Small holders are not favourably placed in the market

because of non flexibility in prod.mix. y They sell their produce in the form of
y RSS y Latex y FC.

Existing Distribution Systems

RSS Latex FC
Unlicenced traders Rubber marketing cooperatives Village Level Dealers Collection depots of RPS/ Cooperatives Collection depots of proc../ Pvt dealers

Licenced dealers

RPS/ Cooperatives

Town level dealers

KSCRMF

Terminal dealers

Processors

Rubber Prod Manufacture rs

Marketing by Estates
y Improved marketing system with better price

realization. y Have their own centralised marketing set up which helps them to make direct sales to consumers. y Directly sell sheets to purchase depots of manufacturers or to terminal dealers in kottayam/ cochin.

Estates

RSS

Latex

FC

Town level dealers

Own processing units

Other processing units

Agents

Terminal dealers

Agents

Rubber product manufacturer

Problems & Challenges

y Major problem is wide fluctuation of price in NR marketing. y Also problem of future trading in India, which is integral part of y y y y y y

marketing system in other country. Problem of grading and price margin by village level dealer. Problem of grading & packaging by town level dealer. Bottleneck in transportation. Increase in labour cost for loading & uploading in terminal markets. Problem of licensing to buy a produce by small dealer / processor. Problem of illicit trading.

IMPROVED VALUE CHAIN

MARKETING CHANNEL FOR SMALLHOLDER S RUBBER

EXTERNAL MARKETING OPEN & DIRECT TRADING

y Direct trading between producers and consumers (especially tyre-making consumers) help in growth and better consistence & tailoring of consumer needs y Indian rubber industry should take malaysian marketing structure. y Improves the direct export.

y Avoiding illicit trading. y Minimises the labour cost. y Setting up village level processing unit & storage

facilities.

Conclusion
y Indian rubber industry is unique with 1 million

producers with 3 tier marketing system. y Rubber board provides technology, training & market assistance. y Small holders are dominant & they form cooperatives to market their rubber. y 60% tribal families of S.India are engaged in rubber production with support from the govt & different cooperative agencies. y Improvements have been done by the govt to improve the rubber market in N.E. India also .

THANKYOU