CHAPTER 5 GENERATON OF SURPLUS N RUBBER PLANTATONS Kerala has a fascinating history of rubber plantations which has changed the fate of lakhs of people across the length and breadth of the state. For a variety of reasons the continuance of rubber cultivation is imperative in Kerala. The rubber crisis which began by the middle of 199E1 was against the aspirations of the rubber growers in Kerala. The most important incentive that can be given to any farmer is to give a remunerat ve price for this produce. When the price of a crop goes up, its cultivation will increase. The expansion of the cultivation of Cocoa in :1970s and Vanilla in 2000s illustrates this phenomenon. Similarly the price of natural rubber showed an increasing trend in 1994 anj this trend continued up to 1997. After 1997 the price showed a decreasing trend which continued up to 2002. From the middle of 2002 the prices of natural rubber started a recovery. After deducting the cost of rubber cultivation from the total income we can calculate the surplus income of rubber growers in Kerala. n order to identify the significance of rubber plantations in Kerala, the cropping pattern in Kerala has to be properly analysed.
5.1 Mono-Cropping of Rubber Plantations in Kerala. From 1997 onwards the rubber plantation industry has been passing through a period of great strain and stress due to the fall in Table 5.1 Cropping pattern of Major Agricultural Crops in Kerala. (Area-Percentage) Year Coconut Rubber* Paddy Pepper Tapioca Total 1996-97 30.00 15.00 14.26 6.05 4.00 69.31 1997-98 29.00 16.00 13.04 6.08 4.30 68.42 1998-99 30.25 16.11 12.09 6.25 3.87 68.57 1999-00 31.72 16.21 11.99 6.80 3.84 70.56 2000-01 31.19 15.80 11.58 6.64 3.70 68.91 2001-02 30.26 15.88 10.77 6.81 3.72 67.44 2002-03 29.90 15.72 10.25 6.64 3.64 66.15 Rubber is cultivated in more than 20 per cent of total agricultural land in Kerala as mentioned in chapter 2. But in the case of cropped area- paddy, Tapioca etc. - are cropped more than once in a year. Hence the area of cultivation is counted more than once and thus the total cropped area increases. Hence the percentage of area under rubber is different in this Table. Source: Economic Review Kerala State Planning Board, various volumes compiled.
the price of natural rubber. This has aired many doubts about the future prospects especially because this steep fall was just after the unprecedented rise in price level scaled in the mid-periods of the last decade of the 2oth century. The other major rubber producing South East Asian Countries earned more domestic currency by exports from the devaluation of their currencies. Hence a decline in the price of natural rubber in the world has an adverse effect mostly on ndia. Kerala which produces 92 per cent of the total natural rubber in the country and Kottayarn District which produces 25 per cent of the total output of the state (table 2.5) were worst affected by the unprecedented price crash. Table 5.1 shows the cropping pattern of the major agricultural crops in Kerala. Fig. 5.1 Cultivation of Major Crops in Kerala( 2002-03) 1 1 6.64' - 10.25 Coconut Rubber Paddy Pepper Tapioca
t can be seen that nearly 70 percent of the total agricultural land in Kerala comes under five agricultural crops. Further analysis shows that one particular crop dominates in each geographical area of Kerala; For example, coconut is grown mostly in the coastal areas whereas rubber in Central Travancore and paddy in Palghat and Alappuzha districts. Table 5.2 Percentage of Rubber in the Total Agricultural Area of Rubber Growers Percentages of Area Under Natural 0-20 per cent Rubber Growers 20 per cent - 40 per cent 36 40 per cent - 60 per cent 88 60 per cent - 80 per cent 244 80 per cent - 100 per cent 216 Source: Field survey among 600 rubber growers from different clusters. The composition of the main agricultural crops in 2002-03 in Kerala is shown in fig. 5.1. There are several reasons for the
concentration of particular crops in particular areas such as climate, availability of rainfall, nature of soil, availability of labour etc. Table 5.3 ncome From Rubber and Total Agricultural ncome of Rubber Growers (n thousands) Total Agricultural No. of farmers ncome from 60-80 80-100 100-150 Above 150 40 98 54 138 48 114 46 112 Source: Field Survey among 600 Rubber Growers from different Clusters. Table 5.2 shows the percentage of area under rubber with the farmers covered by the study. Out of the 600 farmers selected for the survey 460 farmers cultivate rubber in more than 60 per cent of their land. Of this 216 farmers cultivate rubber in more than 80 per cent of their area. Hence we may nfer that in major rubber growing
areas in Kerala, rubber is a mono crop. n the case of income natural rubber is the main contributing factor for the rubber growers. Table 5.3 shows that the major share of agricultural income is from natural rubber. This is quantified in Table 5.3. Table 5.4 shows that 464 out of the 600 farmers selected for the study earn more than 60 per cent of their income frorr~ rubber cultivation. Moreover 256 farmers get 80 per cent of their income from rubber. Table 5.4 Percentage of ncome from Rubber out of the Total Agricultural ncome of Rubber Growers ncome From Natural Number of Rubber 0-20 per cent 2-40 per cent 40-60 per cent 60-80 per cent 80-100 per cent 24 100 208 256 1 1 Source: Field Survey among 600 Rubber Growers from Different Clusters. From Tables 5.2 and 5.3 we can compare the significance of natural rubber as the source of income. The number of farmers who have above 80 per cent of their land under natural rubber is 216. But the number of farmers who earn above 80 per cent of their
agricultural income from rubber c:ultivation is 256. This is illustrated in Table 5.4. Rubber contributes more than 60 per cent of the agricultural income of 464 farmer!;. From the above analysis it is clear that natural rubber is a mono crop for majority of rubber growers in Kerala. The income of the majority of the rubber growers depends entirely upon the price of natural rubber. 5.2 Cost of Rubber Plantations in Kerala. The value of land put to cukivation of natural rubber in Kerala is comparatively higher than the land under other plantation crops in Kerala. Considerable amount has to be spent to maintain rubber plantations in Kerala. The care given to rubber trees generally depends up on the price of rubber. When the income from rubber plantations is comparatively higher, farmers devote a comparatively higher share of their income for the up keep of rubber plantations. This is mainly reflected in the land improvement measures, spraying, and use of fertilizers. The wages also show a relation to the price of rubber. The price of rubber is reflected in shading, and in number of tapping days also. The expenditure on maintaining the rubber holdings is increasing. The cost of inputs related to rubber production is on the
Table 5.5 Per Hectare Expenditure on Tapping Rubber in Kerala (n Rs.) ** Wage = in Rs./tree. Total wage in a year =Wageltree x 400 x 140. Here = 140 No. of tapping days in a year. 400 =No. of trees /hectare Source ; Field Survey in major ri~bber areas in Kerala.
Fig 5.2 Maintenance Cost of Yielding Rubber 2 - L A L - L - L % g 8 8 % m G G! 3! 3! 3! 3 w Y e r ~ y ~ @ 8 9 8 8 $ 8 D rs 8 8 8 sloseriesll t 3 Year --- increase. Table 5.5 shows the per hectare expenditure area of tapped rubber in Kerala. The number of tapped rubber trees/ha is expected to increase. Table 5.5 shows the per hectare expenditure area of tapped rubber in Kerala. -The number of tapped rubber trees/ha is expected to be 400 and the number of tapping days per year is estimated at 140. The expenditure shown in this Table is the average, expenditure of the rubber growers. The yearly cost of maintaining the yielding rubber plantations is shown in Fig 5.2 with the help of simple
bar diagram. t can be seen that the cost of maintaining rubber plantation is increasing at a constant rate irrespective of the decrease in the price of rubber. Decrease in income has compelled the farmers to reduce expenses on fertilizers and the like. The expenditure shown is only those of tapping trees. For the first 7 years, there is no return from rubber plantations from sniall holdings in Kerala. expenditure will be higher during these periods. But the The main expenditure during this period is on poly bag plants, manuring, spraying, weeding, rain pit for water conservation, land improvement etc. During this period subsidies mrill be given to rubber growers from the Rubber Board in the initial years as follows. a. Subsidy at the rate of Rs.5000/hectare for rubber growers owning * up to 20 hectares and Rs.30001-for growers above 20 hectares of rubber cultivation. b. Additional assistance to small holders owning up to 6 hectares by way of re-imbursement of the cost of planting materials, half the cost of fertilizers used during the growing period and a subsidy of Rs. 150/hectare for soil conservation work. When the scheme was introduced, the cost of planting and - maintenance of rubber plants up to tapping stage was calculated at Rs.l5000/hectare(estimation of tne Rubber Board). The subsidy and other assistance covered 50 percent of this cost. Rubber Board
provided 3 percent interest subsidy. During the seventh plan period (1985-go), in traditional areas the cash subsidy was restricted to small holders owning upto 5 hectares. On the other hand, in nontraditional areas, it was granted irrespective of the size of holdings. Table 5.6 Rubber Production Subsidies in ndia (Rs. Millions) Materials Source : Rubber Board, Kottayam: ndian Rubber Statistics- various volumes compiled.
The additional assistance was confined to the use of polybagged plants at a rate of Rs.270Cl/hectare. A provision for interest subsidy at a rate of 3 percent per annum was also there which was exclusively for small farmers (up to 5 hectares) in the traditional? areas. The planting and maintenance cost come to Rs.22000/hectare. The subsidies and assistance covered 35 percent of the total cost. The subsidy schemes of the Boartl in the last 10 years are given in table 5.6. During the years 1993-1997, the assistance in the form of planting grant was Rs.8000/hedare limited to a maximum extent of 2 hectares in the case of small holders in traditional areas and 5. hectares in the case of rubber growers in non-traditional areas. This amount was enhanced to Rs.l8000/hedare in 1997. n 2000 this amount was reduced to Rs.l2000/hectare in traditional areas and Rs.l6000/hectare in non-traditional areas. This rate is applicable in 2003 also. From table 5.6 it can be seen that the rubber plantation subsidy - in 1997-2000 was higher than that of the preceding and succeeding years. This was due to the increase in financial assistance during this period (Rs.l8000/ha.). Moreover the area of re-plantation and new- plantation was also higher during this period as shown in table 2.6.
The expenditure on infra-structul-al subsidy in non-traditional area also was found increasing. This shows the growing initiative of the Rubber Board in the development of rubber plantation in non- - traditional areas. The additional assistance for planting with poly- bagged plants in 2000 was Rs Slplant for general categories of growers and Rs.7/plant for SC/ST rubber growers limited to 500 plants/hectare. This rate was reduced to Rs.41plant and Rs.6plant in 2001 and Rs.31- and Rs.51- respectively in 2002. 5.3 The Problems of Rubber Growers in Kerala. The intensity of the rubber crisis in Kerala is to be examined - from four different standpoints ie. rubber growers, rubber dealers, workers (in rubber estates), rubber processors and rubber product manufacturers. The major problems faced by rubber growers due to the rubber crisis are as follows: a. The sustainability of rubber cultivation in Kerala primarily depends on ensuring a remunerative and relatively stable (free from uncertainties and vagaries of the market, especially the domestic market) price regime, which was the key input in establishing rubber cultivation a success story in Kerala.
The decreased price since 1997 led to loss of confidence of rubber growers. The low prices leti many farmers to neglect rubber cultivation, and even a few haw been compelled to change the cropping pattern of their land to other crops. The annual replanting that averaged 7000 hectares all through the boom years of the nineties has dropped to 4500 hectares in 2000-01 (Table 2.6). Similarly new planting declined from around 9000 hectares to 4000 hectares. b. Upto 1997 there was steady hike in the wages given to workers (tappers) in rubber plantations. But the decrease in price of natural rubber prevented the rubber planters from enhancing the wages of - workers in their plantations. t was also the situation of workers in other rubber related activities. From Table 5.5 it can be seen that wages given to workers (tapping) were increasing at a constant rate up to 1996-97. But thereafter majority of the rubber growers were ready to increase the wages only after 5 years. Some of them paid the same rate in the sth year also. n the rubber plantations in Kerala the wages demanded and realized depend on the price of natural rubber. Due to uncertainty in the price of natural rubber workers try to abstain from rubber plantations. n a field survey conducted among 300 farmers, 15 percent were found using family labour in rubber plantations due to scat-city of workers. One of the main
reasons for the decrease in the production of natural rubber in Malaysia is the shortage of labout-. c. Long-term investment on a perennial crop can be economically attractive only if a steady and sec:ured return is ensured. Only rubber fits in with these criteria in the agro-ecological zone of Kerala. But the decrease in the price of natural rubber leads to decrease in confidence among farmers in Kerala. d. The previous analysis shows that rubber is the only source of income for majority of rubber gyowers in Kerala. Hence their entire - plans for future depend upon their calculations and expectations regarding income from rubber plantations. The wide fluctuations in the price of natural rubber put them in a miserable situation. Some rubber growers are found unable to complete the construction of their houses started during the period when the price of rubber was high. e. During 1995-96, 13 percent of the rubber growers (sample survey among 600 rubber growers) were selling their produce in the form of field latex. n this period the price of field latex was fixed on the basis of dry rubber content (DR(3) in latex in parity with graded sheet rubber. But due to fall in price the centrifuged latex began to be
calculated in parity with the price of un graded rubber. The difference between the price of graded rubber and un graded rubber widened to more than Rs.3lkg after 1997. Hence the number of rubber growers - selling rubber in the form of field latex decreased to 9 per cent. These rubber growers are compelled t3 construct smokehouses and sheds for processing and purchase rubber rollers. f. n order to get rubber plantation subsidy majority of rubber growers cut trees from their agricultural land. One of the conditions for rubber plantation subsidy stipulates 'in the case of small holders, trees other than rubber at the rate not exceeding the number fixed (40 coconut * trees180 arecanut trees/20 fruit: or wood trees) can be retained per hectare in a distributed manner, if such are already growing on the land proposed for replanting/new planting"'. When the price of rubber came below the cost of production, the rubber growers regretted of cutting fruit trees and wood trees before planting rubber to get subsidy. Out of the 600 farmers interviewed, 102 (17 per cent) have not received subsidy from Rubber Board due to ignorance about its schemes and reluctance to cut fruit trees. ' Rubber Board (1993) Rubber Plantation Development Scheme -Phase 4 p.5
g. Although 92 percent of the natural rubber produced in ndia comes from Kerala, her share in its cmsumption is only 15 per cent. Moreover the scope of rubber-based industries in Kerala is also limited and hence the market for natural rubber produced in Kerala is not assured. Hence the rubber growers face uncertainty. h. Since natural rubber is a mono-crop, there is no subsidiary income from rubber plantations. The only subsidiary income from a rubber plantation is rubber wood, which is received only when the rubber tapping is over. The price of rubber wood also decreased during the period when the price of natural rubber decreased. As seen in - chapter 2, rubber wood processing in Kerala has not developed up to the mark so as to process the entire rubber wood produced in the state. Hence the potential price of rubber wood is not realized in Kerala. n major rubber producirig countries due to value addition, rubber wood has become an additional source of income to the farmers. - i. The co-operative societies with crumb rubber factories under their ownership were able to purchase scrap rubber from rubber growers at a price higher than that was offered by private dealers. The decline
of co-operative crumb rubber factories led to decrease in the price of scrap rubber. n 1995 there were 6 co-operative crumb rubber factories in Kerala. Of these co-operative crumb rubber factories, only 2 were functioning in 2000. Out of the 600 rubber growers who participated in the survey, 120 were selling their rubber to co- operative crumb rubber factories; or societies. j. The cess and taxes and other incomes of the Government from rubber declined and hence thl?t-e is subsequent reduction in the subsidy given to rubber grower!;. During 1997 the subsidy given to rubber growers was to the tune of Rs.l8,00O/ha in traditional rubber - growing areas. But in 2000 the subsidy was reduced to Rs.l2000/ha. k. The real estate business was n progress in Kerala during 1995-96. Due to the decline in the price of rubber the value of land in major rubber growing areas also declined and those engaged in such business were in loss. The Banks, which provided loans under the mortgage of land also faced diffizulty in recovering loans. The sale of automobiles in the rubber growing areas also declined to a marked extent. Even in the case of bank deposits in rubber growing areas - the effect was the same.
. The standard of living of the people in rubber growing areas increased in accordance with their income from natural rubber in 1994-1997. When the price of rubber declined after 1997, the rubber growers found it difficult to maintain their previous standard of living. Several rubber growers who purchased cars during the boom period sold them in the depression peliod due to their inability to maintain the vehicle with a reduced incorr~e. m. The collective bargaining power of rubber growers went low. As discussed earlier 58 per cent of the total rubber produced in ndia is consumed by tyre and tube ind~stry. Hence these industries though few in number are able to control the price of natural rubber in Kerala. The supply of rubber is made by 9 lakhs rubber growers in the country. n. n ndia rubber cultivation is a small growers' business. Hence due to scarcity of capital these small rubber growers are not in a position to start rubber-based industries or any other process of value addition. Their only hope is rubber marketing co-operative societies. n Kerala the functioning of rl bber marketing societies is not up to the mark. They are not in a position to start more rubber based industries.
o. Land improvement measures in rubber plantations have declined due to decrease in the price 3f natural rubber. Soil and water conservation is required for the preservation of ecological balance. Contour bunding and the digging of pits to hold water have decreased in rubber plantations. n the field survey conducted, only 16 per cent of the rubber growers are taking proper land improvement measures. p. The income of the Rubber Eioard comes mainly from traditional rubber growing areas (Kerala Stdte and Kanyakumari district of Tamil Nadu). But the expenditure o: the board is mainly for improving rubber cultivation in non-traditional areas. For eg. The rate of subsidy given in traditional areas after 2000 is Rs.l2000/ha. whereas it is Rs.l6000/ha. in non-traditional areas. This will adversely affect the prospects of rubber growers in traditional areas. q. The Government of ndia notified the minimum price of natural rubber at Rs.32.09/kg. for RSS 4 and Rs.30.79/kg. for RSS 5 in 2001 following court decisions on the tubber Act 1947. The ultimate effect was that rubber dealers abst:ained from the market and they purchased rubber of all grades as un graded rubber at a price less than Rs.27/kg. Hence the declaration of a floor value for rubber
without the institutional arrangement to purchase it will adversely affect the prospects of rubber growers. 5.4 Opportunity Cost of Rubber Plantations in Kerala n order to quantify the exact surplus from rubber plantations, it * is necessary to examine the income from other crops grown in natural rubber growing areas or the opportunity cost of rubber plantations in selected Districts. Opportunity cost is the income from forgone opportunity. n other wortls it is the income derived from the next best alternative. According to the field survey the major crops grown in natural rubber growing areas are Coconut, Arecanut, Tapioca, Cocoa, Pineapple etc. Thf? peculiarity of agriculture in Kerala is that the land value is higher compared to other states. "Agricultural land prices are so high in Kerala that if interest on land value is added to the paid out costs of cultivation, none of the major crops cultivated in the state is economically viable. Thus land is not treated as a means of production in the state but is often regarded as an asset that can be used for speculative exchange,"2 Natural rubber is grown in areas which are less than 1000 feet from the sea level. - We can analyse the cost of and income from these crops one by one. Since we are analysing surplus income the cost of plantation and rent? Oonunen M.A. (1994) " Kerala and the New World Order: Some Tenldtlve Hypolhesrs," paper presented at the First nternational Congt;nss on Kerala %dies, Thiruvananthapuram, Aug. 27-29.
of land are not taken into account. :oconut Coconut cultivation occup es 31 per cent of the total cropped area in Kerala. But in Kottayam district the area under coconut is only 19.6 per cent of the total cr3pped area whereas in dukki district it is only 9 per cent. But in Ern3kulam district, coconut is the major crop with 30 per cent of the area under coconut. n Kottayam district Table 5.7 Expenditure on Coconut C:ultivation in Kerala.(Rs./ha.) Expenditure (Rs./Ha.) Fertilizers Land mprovement Spraying 1500 1500 Pesticides Harvesting -2400~1 2000 Source: Field Survelf
more than 50 per cent of the total cropped area is under natural rubber. Hence coconut cultivation is of less importance in Kottayam and dukki districts compared to other districts of Kerala. The cost of coconut cultivation is as follows. n the survey it was revealed that the average production of coconut from one hectare of land comes to 5000 coconuts. At an average price of Rs.fj/coconut, the income of the farmer comes to Rs.30,000/-. On deducting the expenditure the farmer will get a net income of Rs.20,600/- per hectare. Hence an average farmer receives around Rs.20,000/- in the selected districts. Here also the initial planting costs were not taken into account. Like rubber, the. cost of land selected for the cultivation is also comparatively higher. Out of 600 farmers participated in the survey 520 were cultivating coconut. Others were cultivating coconut for their domestic consumption only. Out of 520 coconut farmers 73 farmers cultivate certain intercrops like Cocoa, Pineapple etc. in coconut plantations. Their income will be comparatively higher than coconut growers who adopt mono-croppincl. Cocoa Cultivation n Kottayam, dukki and Ernakulam districts cocoa is cultivated mainly as an intercrop of coconut and other trees. Like
natural rubber, the production of cocoa is highest in Kottayam district. These districts contribute 73 per cent of the total cocoa produced in the state. The harvesting time of cocoa is a strainful period for the farmers. Usually btrds and squirrels spoil the fruits. Moreover, sufficient irrigation fat:ilities are required for this crop. Hence daily care is required in harvesting period also. The average yield is 2000kg/ha. The average price received by the farmer is Rs.201kg. Hence the income of the farmer is 2000x20=Rs.40,000/ha. Table 5.8 Expenditure on Cocoa Cultivation in Kerala.(Rs./ha.) Fertilizers Expenditure (Rs./Ha.) rrigation Crop Protection 4000 2000 1 Harvesting 3000 Source: Field Survey - On deducting the expenditure for the up keep of the trees, the farmer realises an amount of Rs.;!8,000/ha.
Plantain including banana occupies less than 5 per cent of the total cropped area in these districts. During the infant stage of rubber trees, plantains and pineapple are widely cultivated in Kerala. But in Kottayam district pineapple cultivation is comparatively low. But plantain is cultivated in 23 per cent of the rubber plantations selected for the survey. The cost of Plantain cultivation estimated from field is as follows. Table 5.9 Expenditure on Plantain Cultivation in Kerala.(Rs./ha.) tems Expenditure (Rs./Ha.) Pesticides Fertilizers Miscellaneous Wages Total 1500 4000 5000 6000 2000 5000 23500 -- - Source : Field Survey
The average price received by the farmer is about Rs.6/kg. Hence the total income received will be around Rs.60,000/-. On deducting the expenditure from income, the farmer receives an income of Rs.36,500/-. lgpioca CWvation Being a fodder crop a sizeable portion of the crop will not come to the market for sale. n the survey it was found that 23000 kg./ha. is the productivity of tapioca. The expected cost of cultivation is as follows. Table 5.10 Expenditure on Tapioca Cultivation in Kerala.(Rs./ha.) Land preparation Expenditure (Rs./Ha.) Wages Miscellaneous 5000 4000 Total 20000 Source : Field Survey
The average price received by the farmer is about Rs.3/kg. Hence the total income received will be around Rs.69,000/-. On deducting the expenditure from income, the farmer receives an income of Rs.49000/-. Arecnut cultivation covers only 2.7 per cent of the total cropped area in Kerala. The productivity of arecanut in Kottayam district is also comparatively lower. The average productivity of arecanut in Kerala state is 1017 ky./ha. Whereas in the survey it was Table 5.11 Expenditure on Areanut Cultivation in Kerala.(Rs./ha.) tems 1 Expenditure ( Rr./Ha.) Spraying Pesticides Harvesting 3000 1 Processing 500 1 Total 8500 Source: Field Survey
found that the average productivity of areanut is 600kg./ha. The cost incurred in selling arecanut is as follows. The expected price of dried arecanut is Rs.45/kg. Hence the price received by the farmer will be 600x45 = Rs.27,000/ha. On deducting the expenditure from income the farmer will get a net income of Rs.l8,50O/ha. Although arecanut is cultivated in a very small portion of Kottayam district, the planters adopt mono-cropping. '-he number of trees in arecanut estates is comparatively higher than that in Coconut plantations. 5.4 Surplus ncome in Rubber Plantations in Kerala. The field survey among rubber growers in Kerala during 2001 shows that Rs.40 /kg. is a reasonable price of natural rubber. Table * 5.5 shows the cost of rubber plantations in Kerala. The productivity of natural rubber from the survey conducted is about 1900kg./ha. This rate is higher than the state average. Hence the income of the farmer from sheet rubber when the price of rubber is Rs.40/kg. will be Rs.76000. Moreover, the income from scrap rubber (about 450 kg. at a price of Rs.32/kg.) will be Rs.14400/-. Hence the total income of the farmer comes to Rs.90,400/-. After deducting the expenditure the net - income comes to Rs.50,000/-. Hence as far as Kerala state is concerned, natural rubber is the most suitable plantation crop in the midland of Kerala. Hence any price above Rs.40/kg. for sheet rubber and Rs.32/kg. for scrap rubber can be treated as a remunerative price
Table 5.12
with surplus income. Here the increase in the cost of living as a result of the price rise in the rubber growing areas is also taken into account. Here the annual surplus income due to increase in price of natural rubber is Rs.l8635/ha. Farmers' income vary according to the change in expenditure or change in the nature of production. The surplus income in 1995-96 and 1996-97 are comparatively higher than the surplus income in 2003-04. During 1995-96 the average price of natural rubber was Rs.52.04lkg.and the price of scrap rubber was Rs42lkg. Hence the surplus income of the rubber growers during this period was. Sheet Rubber = 1900 kgx Rs.5.2.041- Scrap rubber = 450 Kg. Rs.42/- = Rs.988761- = Rs.189001- Total = Rs.l17776/- Expenditure = Rs.22775/- Surplus income =: Rs.95001/- Here the surplus income in the middle of 1990s was more than 5 times than that of 2003-04. Moreover, it may be - noted that the purchasing power of rupee in these two periods is different. n the middle of 1990s there was an upward trend in the price of natural rubber. But the recovery in the price of
natural rubber in 2003 is followed by severe economic depression in rubber growing areas. Hence the appropriations of surplus income in these two periods are different. The appropriation of the surplus income is examined in the next chapter.