Rubber - the most remunerative plantation crop

Clinton Rodrigo

RUBBER INDUSTRY: This narration constitutes advice to an investor today - contemplating a worth-while and profitable investment into a plantation crop where he effectually faces a "Hobson's Choice". This article is aimed to help this "Doubting Thomas" as best as I could.

My contention appears to be the opinion of the many who are today acquitting themselves as outstanding and excellent plantation personnel - and not a case of the "monkey praising his own tail". Please accept this contention with due modesty to my self as I do not want any one to feel otherwise.

About sixty percent of the senior executive officers of the 20 regional plantation companies and its allied companies are those with whom I had the very pleasure and privilege to work with. They all constitute the "Cream" of the earlier existent plantation arena during the nationalised era.

Initially, the investor whom I am hoping to advice should select the crop he intends to plant from the above stated by isolating the suitable area - by virtue of its location. Rainfall, elevation, topography and the success of that crop selected - and how it grows as at now in its present location.

I must state that at this juncture, the crop rubber appears to be the most feasible and profitable. But it must be remembered that this crop is very selective to the above criteria mentioned. It can be successful and economically grown only below an elevation of about 800 ft above sea level and in adequately rain fed areas of Sabaragamuwa, Kegalle and Kalutara districts.

I am aware that the Government is keen on growing budded rubber in Bibile and Moneragala - which in my view has inadequate rainfall. They were and are essentially citrus growing areas - where earlier old seedling rubber grew. The possible success then was that old seedling rubber has a deep penetrating "tap root" - which feeds from deep into the soil.

The then rubber growers underwent an unbelievable slump in prices that lasted for decades and this situation dissuaded the planting of rubber as a profitable crop. This resulted in our export volume dropping to about 1-2% as at now from the earlier 8%. Further the then rubber planters uprooted their rubber and planted essentially tea and oil palm as substitute crops.

But now the wheel has turned full circle and every one wants to grow rubber. But I should warn the government that they should not kill the goose that lays the golden eggs by imposing unnecessary and heavy taxes incessantly. This action will only dissuade the objective of personnel being induced to plant rubber. The crop rubber as at today is the most profitable crop from the vast range of specified plantation crops and hopefully it should remain so if disincentives are not forcibly imposed.

My contention is that I should restrict myself to the crop rubber in this narration as if I do so for all the crops mentioned at the inception, this article will never be published. The printed media is insistent that they publish only short narrations. In all instances it is difficult to make same "short and sweet" and also getting in all that has to be stated.

The reader may question as to the reason why this sleeping giant - rubber suddenly arose from the deep slumber to now eventuate in obtaining optimum prices. This did not occur for over the past 20-30 years when the rubber grower was a frustrated, disgruntled individual who had to sell his rubber land or plant another crop after uprooting the rubber in desperation having no other alternative but to do so.

The principal rubber growing countries are Malaysia, Thailand, Vietnam, Indonesia and our own Sri Lanka now being only a minor contributor to the requirements of the world market. These countries mentioned are surrounded by two of the largest heavily populated countries in the world.

The most densely populated is China - now developed and has opened its doors to foreign trade as against what it was earlier a closed economy. It is common knowledge that China has a massive population of one thousand three hundred million souls. Besides China, the other large giant is India, now having almost the same population as China may be a little less. Hence their demand for rubber is unbelievably excessive.

These two countries have a combined population of two hundred and fifty thousand million human souls. This appears gigantic against our Sri Lankan population of a negligible twenty million. The other rubber growing countries mentioned herein do not come anywhere near the total population of India and China. Both these countries are desperatively striving to control population.

Hence the commonest family planning contraceptive termed condom - can only be made with natural rubber - and nothing is made off the alternative synthetic or artificial rubber. In addition, large quantities of natural rubber is used to satisfy the international requirement of gloves both surgical and household.

The competition that existed from synthetic rubber to the natural rubber industry has thus virtually ended - as the raw product for the manufacture of synthetic rubber is petroleum or Oil. As is common knowledge now, the cost of this commodity has increased by leaps and bounds due to the heavy or shall I say very heavy price increase of oil in the world market. This happening has thereby effectually or totally stopped the manufacture of synthetic rubber.

Besides this catastrophe, however much technical know how has improved, still it cannot in many instances match the intrinsic, inherent natural properties of natural rubber. These two reasons in the main is why there is an effectually unclassifiable insatiable growing demand for natural rubber. The main method of international transport from one country to another is now by air - which mode too has increased beyond comprehension. Hence essentially aeroplane tyres and pneumatic tyres can use only those made of natural rubber.

In addition, as I have mentioned earlier in this narration, rubber growing can be successfully done if it merits the criterion of what I mentioned at the commencement of this article. Hence the globalisation of growing rubber is compulsorily shrunk in consequence.

As a result as at now with it getting worse in time to come where natural rubber is concerned production would never be able to meet international demand. Hence here lies the positive future for natural rubber.

In consequence, as at now it is the crop that should grow from strength to strength and hence as national minded civic conscious citizens lets "hit the iron while it's hot" and hoping and praying that it remains so. This is the only guarantee that more and more people will continue to grow more and more rubber in spite of the unfortunate repressive restrictions nationally imposed on its further planting.

The Government can help achieve this objective by not imposing destructive further cesses and levies. But in the alternative it should afford more advantageous features to induce and encourage the more accentuated growth of rubber in the interest of the foreign exchange potential of this crop both in the exportation of Value Added rubber products and also in the raw form.

The acceptable contention is like the "light at the end of the tunnel" in this instance it will be money at the end to the producer that ultimately matters to encourage and induce the rubber grower - and the investor to further propagate the plantation crop - rubber. This will benefit both the individual concerned and the country - our own Sri Lanka.

(The writer, a veteran planter, was one-time regional Chairman of JEDB Plantations in the Hatton, Nuwara Eliya, Kandy and Avissawella Regional Boards).