With the shutters down on physical trading of natural rubber since March 23, the Rubber Board of India is now readying an online trading platform.
Though rubber growers are apprehensive, decks have been cleared to invite EoIs (expressions of interest) from technical partners for setting up the online rubber trading platform within a fortnight.
“The electronic platform will actually help grower cooperatives like RPS (rubber producer societies) and small-scale rubber dealers get better visibility and achieve price discovery,” according to KN Raghavan, executive director, Rubber Board of India. “It will be designed to complement the current supply chain, linking the rubber dealer, processor and manufacturer,” he added.
Rubber growers, however, are jittery that this would cause cartelisation among buyers, as it happened during tea e-auctions. “E-trading platform is unlikely to clear financial dues, even within a fortnight,” BK Ajith, secretary, APK (Association of Planters, Kerala), said.
There are also fears that costs of maintaining the e-platform would add to the poor price-realisation on rubber.
About 90% of India’s 12.2 lakh rubber farmers have only small land holdings, as per Board figures. A good many of these small farmers sustain on the cash advances (against future crops) that the rubber trader provides them.
Vinod Simon, chairman, Rubber Skill Development Council, admits that the online agriculture trading platforms often has an edge. “However, it is possible to design, teach and operate the online trading platform, in a way that it is a win-win situation for all stakeholders, including the rubber growers,” he told FE.
What makes the transition easier for Rubber Board would be that there is not much of next-generation takers to hop onto the spot trading ring. From 14,988 rubber dealers in 1995, the trader population has nearly halved at 7,135 in 2020.
The lockdown and the tapering of physical trading have, in fact, emerged as blessings in disguise for the policymakers.
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