Sunday, May 04, 2008

Rubber Producer Societies of India

By Ben Bartlett and David Glenn

Organizing for Improved Quality and Marketing Power
Marketing was a priority interest of many of us who traveled to India and Thailand. We were curious to know whether world markets affected the commodity prices in India and Thailand, as they do here in the USA. In India we happened to arrive at a critical time for rubber producers. Key companies that buy raw rubber from the more than one million producers in India were reneging on agreements that set a minimum price level. They contented that imported rubber from Indonesia and Malaysia could be purchased cheaper now that India had to follow WTO policies. Rubber Board representatives (a governmental agency that provides research, extension and marketing assistance to Rubber Producers) were busy trying to share insights into the dilemma, as tempers were high among both producers and the general public.

India is the world’s fourth largest producer of natural rubber behind Thailand, Indonesia, and Malaysia. India is also the world’s fourth largest consumer of natural rubber behind the USA, China, and Japan. Unique in India, however, is the structure of production. Other countries rely on large plantations, but India’s rubber producers are smallholders, averaging less that ,5 hectare per family or just over 1 acre.
Because of the challenges of reaching so many farmers with research and extension services, India has organized its producers into Rubber Producer Societies (RPSs). Each society includes 100 or more producer families. These locally lead groups serve as clearinghouses for new technologies and marketing information while providing services such as group purchases of inputs and collecting or processing of latex. These groups are similar to cooperatives in the US. With the production capacity of the entire group, Producer Societies have hedged their prospects with volume processing and marketing. Groups of Producer Societies were also setting up small manufacturing businesses to add additional value to the raw product.
Our group visited the Rubber Board Headquarters in Kottayam, in the state of Kerala. Here we had a chance to meet some of the Rubber Board Officers, the equivalent of Michigan’s extension service. Following is a photo of the newly constructed Headquarters Training Center. Pictured are members of our Michigan traveling group and staff of the Rubber Board Extension Service.
Our traveling group divided into three small groups to make visits into the field. One group had the honor of being able to visit a tribal group (Kanikarri Tribe) near Trivandrum, the southern-most tip of India. Rubber is a new commodity for this group and nearly 60% of the families are now growing rubber trees. The tribe had only been into rubber production for a few years and was just now harvesting latex. They were already planning for the next step—adding value by establishing a processing unit.
We were amazed at the diversity of crops in this rich tropical ecology. Although holdings were small, farmers had diverse enterprises with rubber trees as well as legumes, mangoes, bees, tumeric, coffee, pineapple, coconut, pepper and other crops. This diversity has allowed farmers to diversify their earnings and markets….a great model for small farms anywhere.

Although rubber is a crop grown half way around the world, it provides some of the same challenges as milk or grain does for Michigan farmers....significant swings in prices, many small producers that sell to a limited number of buyers, and production and marketing challenges that are met by working together with the assistance of publicly funded advisors. So different--yet so similar!
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