Colombo rubber auction to be web-based in future | Sunday Observer

Colombo rubber auction to be web-based in future

Sri Lanka needs to boost value-added products from current levels, to  make up for the losses suffered by natural rubber to synthetic rubber,  in the global market
Sri Lanka needs to boost value-added products from current levels, to make up for the losses suffered by natural rubber to synthetic rubber, in the global market

Rubber exporters say that rubber prices could pick up and exports improve in the coming year, as there is a growing demand for Sri Lanka’s natural rubber in the global market, which has expanded into a large number of sectors within the rubber industry.

“We expect to see some momentum in global market prices which dipped drastically in recent years resulting in tough times for the country’s lucrative rubber industry,” an exporter said. Focus, and more investments in value added exports of rubber based products, have brought a silver lining to the rubber industry according to industry experts.

However, according to the Colombo Rubber Traders Association (CRTA) Chairman, Amanda Weerasinghe, the situation of the local rubber industry is not rosy, with the industry being battered by the drop in global market prices and the wage demands of workers.

“The steep drop in rubber prices from around Rs. 650 to around Rs. 275 a kg and the wage hike demand of workers are a double whammy for the industry which is currently in a precarious state,” Weerasinghe said.

The plantation companies represented through the Planters’ Association have made it clear that they are unable to meet the demand of workers due to the present state of the industry. Planters said that they had proposed a productivity based sustainable pricing mechanism for the plantation sector, which is a better model than increasing wages in an ad-hoc manner from time to time. Plantation unions representing workers have been agitating for an increase of the basic wage of a worker, to Rs. 1,000.

“We could grant some increase if global tea prices pick up. As of now we cannot agree to the demand for a Rs. 1,000 increase as tea prices in the global market are still low,” a planter said.

Speaking on the sidelines of the centennial celebration of the CRTA last week in Colombo, CRTA officials said the Association plans to improve the current auction system to facilitate an efficient market.“There will be some investments made to develop the auction system going into a web-based system,” Weerasinghe said. However, industry experts said Sri Lanka needs to boost value added products from current levels, to make up for the losses suffered by natural rubber to synthetic rubber, in the global market. Currently the synthetic to natural rubber export ratio is 2:1.

According to data available, Sri Lanka’s natural rubber exports dropped from around 70 to 80,000 tons a year, to only around 18,000 tons. The centennial celebrations of CRTA were marked with the launch of a Centennial postage stamp and an auction of latex crepe at the Ceylon Chamber of Commerce auditorium.

The Rubber Committee of the Ceylon Chamber of Commerce which had addressed the interests of the Rubber Trade since 1891, has identified the need for a separate forum to promote the interests of the industry.

The first chairman of CRTA was J. Lochore of Carson & Co. Ltd. Initially the committee comprised two nominees each, from the buyers and sellers. Members of the CRTA were exclusively Europeans, until S.T.L. de Soysa of C.W. Mackie & Co. Ltd was elected as one of the buyers’ representatives in 1945. 

Comments