Natural rubber prices touch all-time high of ₹300 per kg

Natural rubber prices have touched an all-time high of ₹300 per kg for the first time, driven by a combination of bullish trends in international markets, domestic supply shortages, geopolitical tensions in West Asia and a surge in synthetic rubber prices.

Traders said the price rally, coming at the beginning of the production season, offers significant relief to rubber farmers and could encourage them to resume tapping, particularly on trees that have remained untapped.

According to George Valy, president of the Indian Rubber Dealers Federation, the prolonged period of low prices, ranging between ₹147 and ₹197 per kg, had discouraged farmers from tapping. The current price surge is expected to improve their returns and boost production.

However, he expressed concern over the increasing shift from sheet rubber production to latex, which could pose a potential challenge in the long run. While demand for natural rubber is rising, climate change continues to affect production. The disparity between domestic and international rubber prices is another area of concern, he said.

Binoy Kurian, Deputy Director (Marketing) of the Rubber Board, attributed the price rise to a combination of domestic and international factors.

On the domestic front, the impact of El Niño has contributed to supply constraints in the southern rubber-growing regions. Heavy rainfall during the second quarter of the current fiscal disrupted tapping operations, affecting supply and exerting upward pressure on prices, he said.

The West Asian conflict has also played a significant role in the current rally. Rising Brent crude prices amid geopolitical tensions have pushed up synthetic rubber prices, indirectly supporting natural rubber prices as well.

Meanwhile, major rubber-producing countries in Southeast Asia have reported a decline in natural rubber output, adding to the pressure on international prices. Erratic weather conditions during the peak production season, coupled with prolonged dry spells, have also resulted in lower-than-expected availability of raw material in the global market.

The prevailing price levels could encourage more farmers to resume tapping and benefit from improved returns, Kurian said. Indian prices continue to rule above international market levels, supported by strong demand from major consuming industries, tight domestic supplies and firm global prices.

The Association of Natural Rubber Producing Countries (ANRPC) has projected global natural rubber production at 15.039 million tonnes against consumption of 15.356 million tonnes in 2026, indicating a potential supply deficit in the global market.

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