A study by the Public Policy Research Institute (PPRI) recommends reviving rubber producer societies, tapping abandoned plantations, and restructuring incentive schemes to combat the severe crisis in Kerala's rubber sector.

  • Revival of Rubber Producers' Societies (RPS) to assist in value-added manufacturing.
  • Implementation of a scheme to tap abandoned or owner-absent plantations.
  • Restructuring the Rubber Production Incentive Scheme (RPIS) to include labor.
  • Expansion of the World Bank-aided KERA project to all districts.

The natural rubber sector in Kerala is facing an unprecedented crisis characterized by extreme price volatility and declining productivity. A new study conducted by the Public Policy Research Institute (PPRI), a think tank under the Finance Department, has submitted critical recommendations to the Kerala State Planning Board to stabilize this vital industry.

The Grip of Buyer Oligopsony

One of the most alarming findings of the study is the presence of a 'buyer oligopsony.' Prof. Mohan Kumar, Director of PPRI, highlighted that while there are millions of small and marginal farmers, the market is dominated by just eight automotive tyre majors who control over 70% of India's consumption. This imbalance strips farmers of their bargaining power, leaving them vulnerable to price fluctuations.

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Why This Matters

BozokMedia analysis shows that without structural changes to how rubber is priced and sold, the reliance on traditional farming methods will lead to further land abandonment. The shift from rubber to crops like pineapple and rambutan in regions like Chirakkadavu is a clear indicator of a sector in distress.

Reviving Rubber Producers' Societies is essential to transition farmers from raw material suppliers to value-added product manufacturers.

The study, which focused on the rubber-reliant Chirakkadavu Grama Panchayat in Kottayam, revealed a sharp decline in local infrastructure. Licensed rubber dealers in the village have plummeted from 22 in 2020 to just 5 in 2025, while input suppliers and processing units have also seen significant reductions.

Strategic Recommendations for Recovery

To counter these trends, the PPRI suggests several proactive measures. These include overhauling the Rubber Production Incentive Scheme (RPIS) to accommodate labor costs and launching a dedicated scheme to utilize abandoned plantations. Furthermore, the study advocates for specialized training for women in non-tyre rubber-based industries to diversify the economic base.

Additionally, there is an urgent call to expand the World Bank-aided Kerala Climate Resilient Agri-Value Chain Modernisation (KERA) project. Currently, the project only covers six districts; the study argues it must be extended to include all districts and all rubber plantations across the state to ensure comprehensive support.

Did You Know?: The decline in rubber processing units often leads to a 'vicious cycle' where farmers lose access to local markets, forcing them to lease land for alternative crops.

Frequently Asked Questions

1. What is the main cause of the rubber crisis in Kerala according to the study?
The crisis is driven by unprecedented price volatility and a 'buyer oligopsony' where a few large tyre companies dominate the market.

2. How can abandoned plantations help the economy?
Tapping abandoned plantations can increase total production and utilize land that is currently underperforming or neglected.