Sri Lanka’s rubber products exports topped US$ 889.4 million in 2014

By Steve A. Morrell

The Export Development Board (EDB) indicated recently that rubber products manufactured in Sri Lanka realized revenue amounting to $ 889.4 million in 2014.

These products were mainly identified in three segments — tyres, including solid tyres, pneumatic tyres and tubes, gloves, including surgical, industrial, and for household use.

The other products are rubber bands, floor coverings, mats, industrial components, automobile parts, household items and other production items, exported as value added products with wide market destinations.

Rubber production decreased over the past few months, influenced by the drop in oil prices globally, but the demand for natural rubber is not expected to be drastically affected, it was observed.

EDB’s Director, Industrial Products, Chitranjali Dissanayake, said their projections were that subject to temporary production decreases, the rubber sector would rejuvenate and future targets would be achieved.

The government and private sector stakeholders set high target increases; and confidence that these projections would be achieved were feasible possibilities, the EDB said.

As indicated at the International Rubber Conference held in Colombo in 2014, conclusions were that the rubber industry globally would grow 4% to 6%. Growth potential for Sri Lanka, was decidedly high, it said.

The EDB said that considering growth potential, the long history of the industry and distinctive competencies accumulated over the years, it was now potentially realistic to expect exports to reach US$ 3 billion by 2020.

Such projections were based on factual incidence that demand for natural rubber although currently receding, would be a telling factor in world auction centers. The EDB agreed that demand for synthetic products grew parallel to reduction in oil prices.

John Keells PLC., (JKP) Rubber Department, confirmed recently that the rubber industry in Sri Lanka was affected and in terms of production and harvesting of latex, smallholders and plantation companies resulted in losses. Smallholders were not harvesting their latex because of reduced prices they were paid for the raw product.

Additionally, because of ‘wintering’, in January /February 2015, which was a normal phenomenon, production at that time was low. Production of Latex crepe, Scrap crepe, Skim crepe in February this year amounted to barely, 223,850 kilos.

John Keels PLC., further reported that irrespective of marginal price improvement in February this year, the immediate future was not that promising.

Rubber production in 2013 was 110,000 metric tons. Local consumption was 86,415 metric tons, or approximately, 70%.

The EDB confirmed that natural rubber was imported to meet demand because local production dipped. However, with the natural rubber demand increasing, rubber will be commercially viable. No timeframe was placed on this possibility.

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