Industry research by GCS Team – 15th April 2025
“Stretch like a rubber band” metaphorically illustrates resilience — the capacity to endure stress or pressure and bounce back to one’s original state.
Kerala was once known as the “Plantation Capital of India” due to its vast cultivation of crops like tea, coffee, rubber, cardamom, and pepper, which significantly contributed to the state’s economy. According to the Kerala State Planning Board, 29% of the state’s gross cropped area is dedicated to these plantation crops, making the industry a key source of employment and a vital part of the rural economy. However, Kerala appears to have lost this title, as several northeastern and other southern states are now actively promoting specific plantation crops with greater intensity.
- Many rubber plantation success stories from seven sisters of northeast. Mizoram is the latest entry in that group.
- Assam is the undisputed king of Tea plantations and is also referred to as the ‘Tea Capital of the word’.
- Karnataka is renowned as the ‘Coffee Land’ of India.
- The name ‘Keralam’ is derived from the Malayalam word ‘kera’ which means coconut tree and ‘alam’ means ‘land’. So, the ‘land of coconuts’ is supposed to be Kerala but, Karnataka and Tamil Nadu are way ahead in terms of production.
In the early 2000s, while many other crops were facing a severe crisis, rubber growers in Kerala were enjoying substantial profits. The price of the most preferred and widely traded variety in India called ribbed-smoked rubber sheet (RSS-4 grade) rose sharply from Rs.39 per kilogram in 2003 to Rs 66 in 2005. Though the growers were initially skeptical about the price sustaining, it not only held steady but surged touching Rs 240 in April 2011. It was an unprecedented peak in the history of rubber.
Kottayam, the country’s largest rubber trading hub, began to flourish. The town witnessed a visible economic boom—lavish homes, upscale apartments, large retail outlets, hotels, and resorts sprang up. Expensive cars filled the streets, children were enrolled in premium boarding schools, and land sales soared alongside rapidly rising property values. However, the boom was short-lived. In 2012, rubber prices began a steep decline. By December 18, 2014, the price of RSS-4 grade rubber in the Kottayam market had fallen to ₹113 per kilogram, marking a five-year low. The global price of RSS-3 grade rubber in the Bangkok market dropped even further, hitting just ₹95. Today, a cloud of uncertainty hangs over Kottayam and other rubber-growing regions. Numerous dealers have shut down their businesses, and many small-scale units producing rubber-based goods have ceased operations. Millions of growers and workers across Kerala are facing hardship as the prices of cash crops continue to fall, both domestically and internationally.
The following data was extracted from the official website of Kerala State Planning Board:“Production of Natural Rubber (NR) in India declined by 12.9 percent from 6.45 lakh tones in 2014-15 to 5.62 lakh tonnes in 2015-16. Even though the tappable area under natural rubber was 5.59 lakh ha during 2015-16, only 3.91 lakh ha of the area contributed to the NR production during the year. Consequently, the average yield, measured in terms of production per hectare of tapped area, declined to 1437 kg/ha in 2015-16 as compared to 1443 kg/ha the previous year. Adverse weather, high wages, lack of skilled labourers and the grower’s reluctance to harvest or maintain trees in response to the low NR prices have affected the production of natural rubber (NR) in India. The consumption of NR in the country also came down by 2.6 percent to 10.2 lakh tonnes
in 2014-15. This was due to a 2.5 percent decline in auto tyres manufacturing and a 2.7 percent fall in general rubber goods production. With regard to rubber prices, it has been volatile in both the national and international markets. NR prices after scaling to an all-time high during 2011 had fallen significantly, that too at an accelerating pace threatening the very existence of the rubber producers. The fall in rubber prices was contributed by enhanced stock in Thailand, an increase in the world stock of NR, and the relatively low cost of synthetic rubber prices.
The declining rubber production has affected India’s ranking internationally as it has been pushed to the sixth position with countries like Vietnam, Ivory Coast and China also advanced their positions. Thailand continues to be the top producer followed by Indonesia in the second spot in the global rubber scene. The declining price of rubber is a cause of concern. A revival of rubber prices is expected based on the revision of import duty and other measures taken by the Government of India. However, more proactive measures by the government are essential to support the rubber growers. The strengthening and reorientation of the Price Stabilisation Fund is essential.“
Read for more details: https://spb.kerala.gov.in/economic-review/ER2016/chapter02_03.php
The above review report focussed on data available till 2016. The table below from the official website of Rubber Board indicates that there is no significant change in the situation during last decade.
Annual Trends in Area, Production, Consumption, Import, Export and Average Prices of Natural Rubber in India
| Year (April to March) | Rubber area (ha) | Tappable Rubber area (ha) | Production (tonnes) | Average yield (kg/ha) | Consumption (tonnes) | Import (tonnes) | Export (tonnes) | Average price of RSS-4 (Rs/100kg) |
| 2005-06 | 5,97,610 | 4,47,015 | 8,02,625 | 1,796 | 8,01,110 | 45,285 | 73,830 | 6,699 |
| 2006-07 | 6,15,200 | 4,54,020 | 8,52,895 | 1,879 | 8,20,305 | 89,799 | 56,545 | 9,204 |
| 2007-08 | 6,35,400 | 4,58,830 | 8,25,345 | 1,799 | 8,61,455 | 86,394 | 60,353 | 9,085 |
| 2008-09 | 6,61,980 | 4,63,130 | 8,64,500 | 1,867 | 8,71,720 | 77,762 | 46,926 | 10,112 |
| 2009-10 | 6,86,515- | 4,68,480 | 8,31,400 | 1,775 | 9,30,565 | 1,77,130 | 25,090 | 11,498 |
| 2010-11 | 7,11,560 | 4,77,230 | 8,61,950 | 1,806 | 9,47,715 | 1,90,692 | 29,851 | 19,003 |
| 2011-12 | 7,34,780 | 4,90,970 | 9,03,700 | 1,841 | 9,64,415 | 2,14,433 | 27,145 | 20,805 |
| 2012-13 | 7,57,520 | 5,04,040 | 9,13,700 | 1,813 | 9,72,705 | 2,62,753 | 30,594 | 17,682 |
| 2013-14 | 7,78,400 | 5,18,100 | 7,74,000 | 1,629 | 9,81,520 | 3,60,263 | 5,398 | 16,602 |
| 2014-15 | 7,95,135 | 5,33,675 | 6,45,000 | 1,443 | 10,20,910 | 4,42,130 | 1,002 | 13,257 |
| 2015-16 | 8,10,800 | 5,58,900 | 5,62,000 | 1,437 | 9,94,415 | 4,58,374 | 865 | 11,306 |
| 2016-17 | 8,18,000 | 5,84,600 | 6,91,000 | 1,553 | 10,44,075 | 4,26,188 | 20,920 | 13,549 |
| 2017-18 | 8,20,900 | 6,12,000 | 6,94,000 | 1,458 | 11,12,210 | 4,69,760 | 5,072 | 12,980 |
| 2018-19 | 8,22,000 | 6,37,900 | 6,51,000 | 1,453 | 12,11,940 | 5,82,351 | 4,551 | 12,595 |
| 2019-20 | 8,22,300 | 6,63,700 | 7,12,000 | 1,459 | 11,34,120 | 4,57,223 | 12,872 | 13,522 |
| 2020-21 | 8,23,000 | 6,92,900 | 7,15,000 | 1,442 | 10,96,410 | 4,10,478 | 11,343 | 14,185 |
| 2021-22 | 8,26,660 | 7,18,300 | 7,75,000 | 1,472 | 12,38,000 | 5,46,369 | 3,560 | 17,101 |
| 2022-23 • | 8,50,000 | 7,43,650 | 8,39,000 | 1,482 | 13,50,000 | 5,28,677 | 3,700 | 15,652 |
| 2023-24p | 8,88,400 | 7,53,885 | 8,57,000 | 1,485 | 14,16,000 | 4,92,682 | 4,199 | 15,572 |
updated 13.02.2025 p – provisional
Source https://rubberboard.gov.in/
During the rubber boom, the cost of everything—from inputs to labour—rose significantly. Tappers, who extract latex from rubber trees, earned just ₹26 for tapping 100 trees in 1999. Today, in Kottayam, that rate has soared to over ₹200. During the monsoon, an additional cost is incurred to fix rain guards on the bark to stop water from dripping into the coconut shell used for latex collection—this alone costs ₹50 per tree. As a result, many plantations have been left untapped, and there is little interest in replanting older, less productive trees. At one point, nearly half a million workers relied on rubber plantations for their livelihood. However, according to a Hindustan Times report published in June 2024, many rubber cultivators in the state are now shifting to other occupations due to the lack of adequate support for rubber pricing and plantation financing. As a result, the workforce in this sector has dwindled to just 3.5 lakh. This crisis highlights the unique vulnerabilities of Kerala’s economy.
So, how long is the wait? Will it ever bounce back to original state? While small growers are withdrawing, larger producers are doing their best to stretch their limits and survive the prolonged uncertainty. Rubber trees are a long-term investment, with a productive life span of around 30 years—much like running a three-decade business. But growers are caught at different stages of this long cycle. George, a small investor from Kottayam, shared his experience: “I spent the first seven years after the boom replanting and nurturing new rubber trees. The following seven years passed with hardly any income. Now, as we speak, half the productive lifespan of my trees is already over. If this were an annual crop, I could have switched to something else. But with rubber, that’s not an option. At this point, putting up a ‘For Sale’ board is is also not an option because there are hardly any buyers for agricultural or plantation land in Kerala.”
Center-state collaboration, crop diversification, and worker empowerment are seen as crucial for addressing the ongoing crisis. Experts caution that reacting only during price crashes and celebrating during booms is not a sustainable approach. What is needed now are comprehensive government policies and time-bound programs that provide short, medium, and long-term support to help growers navigate market uncertainties. Measures such as price stabilization through setting minimum and maximum prices, building buffer stocks, offering fiscal and export incentives, implementing procurement strategies, and introducing price insurance schemes are essential. For these efforts to be effective, both the Centre and state governments must work together to develop an inclusive approach that considers key factors like the commodity, cost of production, prevailing market prices, and the grower’s cost of living.
References :
https://rubberboard.gov.in/, https://www.downtoearth.org.in/, https://economictimes.indiatimes.com/, https://spb.kerala.gov.in/economic-review/ER2016/index.php, https://www.hindustantimes.com/business/rubber-cultivators-in-kerala-shift-jobs-over-inadequate-support-on-prices-finances-101719047491169.html
