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RUBBER STAKEHOLDER NEWS : Stakeholders agree on terms for Sustainable NR Platform
(Last Updated: 13 Feb 2019)

 

 

 

Stakeholders in the global natural rubber supply network have “aligned on a governance structure” for the Global Platform for Sustainable Natural Rubber (GPSNR), the tyre industry-led initiative.
The GPSNR was formed as an independent platform to drive improvements in the socio-economic and environmental performance of the natural rubber value chain.
Over recent months, environmental non-governmental organizations have argued that the level of control held by tyre manufacturers in the GPSNR would undermine its effectiveness. Agreement has now been reached on “a multi-stakeholder governance structure that includes a greater share of voting weight for ‘civil society’ members,” the organization said.
This follows a workshop by founder members and other stakeholders in Singapore on January 22-23, 2019 and another in Geneva last November.
In Singapore, the more than 50 GPSNR stakeholders also agreed that smallholder representatives should be part of the decision-making structure.
They further highlighted the importance of involving rubber processors, NGOs specialized in social aspects relevant to rubber production, and non-tyre rubber product makers.
The proposed governance structure will be put forward for adoption at the platform’s inaugural general assembly, scheduled for March 21, in Singapore alongside the World Rubber Summit.

India has appointed Dr. Ranjit Matthan (R. K. Matthan) as president of the Indian Rubber Manufacturers' Research Association (IRMRA). Dr. Matthan, Director of Polymer Consultancy Services (P) Ltd, is a global authority in polymer technology and international standards for rubber and rubber products. He succeeds Mr. Rajendra V. Gandhi who has completed his term in Dec 2018.

 
 

Tyre firms roll back prices, hope to liquidate inventory

January 8, 2019

CChennai: On the back of softening natural  coupled with lower  prices, tyre companies reduced prices by 2-5% over the past few days, as they hope to liquidate the inventory pile up due to slowdown in new vehicle sales.

While some companies are in wait-and-watch mode, others including  have announced a rollback of their last November price hike. “We have taken two price hikes in 2018 — one in May and the other in November and we have just rolled back our second price increase,” said Satish Sharma, president,  and Africa region, .

The  is expecting a reduction in GST from the current 28% to 18%.

“The next GST council meeting is end of this week and the industry is expecting a slab reduction so the rollbacks and discounts are a means to get rid of existing inventory. Already tyre companies are offering 4-5% discounts but where there are bulk sales to big dealers, the discounts are as high as 20-25%,” said SP Singh of All India Tyre Dealers’ Federation.

 

December is typically a low wholesale month for the passenger vehicle and two wheeler industry and tyre wear and tear is also less in winter. So inventories tend to be high, he added.

Crude prices have come down from $86 to $54 therefore products like synthetic rubber, carbon black etc are all cheaper now.

Natural rubber prices are also down from  135 per kg mid last year to  115-120 per kg right now, said Singh.

“The adverse effects of the increase in crude, interest rates, depreciation of INR and lack of festive demand uptick has been the maximum in the third quarter. There is some comfort that the rupee has not weakened further and crude prices have softened over the last two months. This is a welcome change for the industry. We also expect demand to resume to normal levels in the . A decision to lower price or not is subject to competitive pressures and will be taken on a case to case basis,” said Anant Goenka, managing director, CEAT.

 

 

Tire industry must continue to go green, according to experts

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Tire industry must continue to go green, according to experts
Sheerin

AKRON — Green business and economic practices, encompassing both manufacturing and recycling, are crucial to the continuing health and viability of the tire industry, speakers said at the recent International Tire Exhibition & Conference (ITEC).

According to Rahinda Mukhopadhyay, director of the Hari Shankar Singhania Elastomer and Tyre Research Institute in Karnataka, India, the population of the world will reach 10 billion humans by 2058.

Population growth will be especially intense in India, which will surpass  as the most populous country in the world, Mr. Mukhopadhyay said.

Along with population growth will come increased economic activity, but also wealth disparity, climate change, increasing social polarization, rising cyber-dependency and an aging population, he said.

 

Because of these factors, auto and tire manufacturers face the challenge of creating new green technologies and expanding the sustainable economy while remaining globally competitive, he said.

“The green economy means improving human well-being and social equity while significantly reducing environmental risks and ecological scarcities,” he said.

Climate change is already having a profound impact on Asia, according to Mr. Mukhopadhyay. The risks include:

  • Increasing crop failure and lower crop production;
  • Increased risk of heat-related mortality;
  • Increased river, coastal and urban flooding, with increased risk of flood-related deaths, injuries and infrastructure damage;
  • Increased water shortages in arid regions; and
  • Increased risk of water- and vector-borne diseases.

To reduce these risks, the world must adopt a green economy that turns away from fossil fuels and unbridled consumption toward a focus on saving resources rather than labor, Mr. Mukhopadhyay said.

In terms of tires, this means the development of renewable, mineral-based and recycled raw materials, he said.

“It is possible to produce a tire with more than a 95-percent non- base,” he said. “However, the application range today is still limited.”

Moving toward a green economy in the tire industry would include moving to:

  • silaca and a new generation of nano fillers from traditional carbon black;
  • natural rubber, bio-based synthetic rubber and recycled materials from traditional synthetic rubber;
  • vegetable fiber-based reinforcing materials, recycled rayon or thinner, ultra-high-tensile steel cord from polyester, nylon and steel tire cord; and
  • Moving to vegetable oils and substances compliant with the ’s Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) regulations from petroleum-derived oils and chemicals.
Tire industry must continue to go green, according to experts
Mukhopadhyay

A more sustainable vehicle fleet is also vital to achieving a green transportation economy, according to Mr. Mukhopadhyay. India is a good example, with a plan that all new  sold within its borders must be 100-percent electric by 2047, the 100th anniversary of the nation’s independence, he said.

By 2030, 40 percent of new vehicle sales and all new vehicles for intra-city transport fleets must be pure EV, he said.

“As vehicles are one of the main sources of air pollution responsible for poor urban air quality, suitable measures should be taken by all concerned to build a green, sustainable future,” he said.

The U.S. tire industry is well advanced in its efforts to achieve sustainability, according to John Sheerin, director of end-of-life tire programs for the U.S. Tire Manufacturers Association (USTMA).

Members of the trade group continue to prioritize research into the health and environmental impacts of the manufacturing and use of tires, Mr. Sheerin said, while at the same time striving to advance the safety and performance of tires and to manage scrap tires as valuable, reusable materials.

“We recognize the need to increase the use of sustainable materials,” he said. “We are increasing the use of micronized rubber powders, which closes the loop in tire manufacturing.”

USTMA members are also investigating the use of recycled carbon black from pyrolysis, orange and soybean oils instead of petroleum, bioisoprene instead of traditional synthetic rubbers and alternative sources of natural rubber such as guayule and dandelions, according to Sheerin.

The percentage of scrap tires that were recycled dropped from 2013 to 2017, to 81 from 96 percent of tires generated, Mr. Sheerin said. A slight drop in markets plus the sheer increase in scrap tires generated in those years was a major reason for this, he said.

Nevertheless, scrap tires represent one of the great success stories in recycling, the USTMA exec said.

“Only lead-acid batteries have a better recycling rate,” he said. In one sense, scrap tires have a more impressive track record than lead-acid batteries, because scrap tires on their own have a negative economic value, he said.

Tire-derived fuel remains the stalwart of scrap tire recycling, accounting for 43 percent of the 3.4 million tons of tires recycled in 2017, according to Mr. Sheerin.

The Environmental Protection Agency has recognized the biogenic content in TDF, in both the greenhouse gas reporting rule from 2010 and the emissions from stationary sources rules from both 2011 and 2014, he said.

Ground rubber accounted for 25 percent of the scrap tire market in 2017, and civil engineering projects for another 8 percent, according to Mr. Sheerin. Some 16 percent of scrap tires were landfilled — the highest level in three or four years, because of a decline in the market — and the remaining 8 percent went to various markets, he said.

“2017 was not a boom year for rubber-modified asphalt,” Sheerin said. “But we expect this year to be better, because of new road construction.”

Reducing scrap tire stockpiles is also a major success story, according to Mr. Sheerin. Since the USTMA began its scrap tire program in 1990, the number of stockpiled tires has plummeted 94 percent, to about 60 million from an estimated 1 billion, he said.

But problem spots remain in several states, either because of bankruptcies among scrap tire processors or lapsed scrap tire abatement programs, Mr. Sheerin noted.

In South Carolina, for example, the state faces the cleanup of 800,000 stockpiled tires left by a processor that went bankrupt. The state has allocated $2.7 million for cleanup, Mr. Sheerin said.

Colorado has two or three massive tire monofills that the state is required to clean up by 2024, he said.

“Texas has 17 million stockpiled tires that they know of, and I know of no plan to clean them up,” he said. “The state needs a new program.”

Two states — Louisiana and West Virginia — claim to have no stockpiled scrap tires, according to Mr. Sheerin.

“Louisiana has done the work and the cleanups,” he said. “The number of stockpiled tires is probably not zero, but the state is very environmentally aware.

“But West Virginia hasn’t done the work,” he said. “It hasn’t even looked for stockpiles.”

 

 

‘What is lost cannot be recovered; we have to look ahead’

KOCHI, SEPTEMBER 19

 

Kerala’s plantation sector is reeling under the impact of widespread damage and crop losses caused by the recent floods. However, the crisis can turn into an opportunity if future growth is channelised along ecologically sustainable and economically viable lines, says Thomas Jacob, Chairman of the Association of Planters of Kerala (APK).

Such an approach, he says, will generate employment and income. He firmly believes that this can be achieved by encouraging inter-cropping and multi-cropping, abolition of agricultural income tax and conservation of soil and water.

The biodiversity of the Western Ghats can be further strengthened if cultivation of fruit crops, bamboo and indigenous tree species known for their timber value is allowed in the plantation sector, he said in an interaction. Edited excerpts:

Will the plantation sector be the same again in terms of activities or the way growers practised farming?

Kerala’s plantation sector has a legacy of more than one-and-a-half centuries; it is perhaps the only industry in the State that withstood and re-emerged from the floods of 1924.

The industry has suffered huge losses, of which some are irreversible. It is interesting to note that the landslides reported in the plantation sector have not originated in the core plantation area.

As far as farming practices are concerned, the primary focus of growers has always been on conservation of resources like soil, water and natural flora and fauna without which the cultivation of plantation crops would not be possible.

The heavy rains and subsequent floods have steeled our resolve to conserve and strengthen resources like soil, water and biodiversity without which the sector may not be able to survive.

How have the rains/floods affected the plantation sector?

All the plantation crops have been drastically affected. The losses are three-fold — crop loss, losses to production infrastructure and losses to ancillary infrastructure.

The total estimated crop loss is above 800 crore, which may accentuate further depending on the recovery period.

The losses to production infrastructure are estimated to be approximately 450 crore and we are yet to quantify the losses to ancillary infrastructure.

If you analyse the weather reports for the last five years, it can be seen that the State had experienced drought conditions of moderate to severe nature in 2015 and 2016.

In 2015, there was deficit rainfall of 26 per cent, and in 2016, a deficit of 43 per cent. In 2018 there is already excess rainfall of over 40 per cent.

That means within a short span of five years, Kerala is experiencing extreme weather conditions, which is a tell-tale sign of climate change.

All plantation crops are extremely weather sensitive and any shift in the weather conditions can affect production and productivity.

The shift of the South-West monsoon to the excess rainfall situation has adversely affected all the crops. The tea industry has already lost 7 million kg in production.

Overall production for the current year will be 30 per cent lower. Cardamom is the worst affected crop, nearly 25 per cent of the plants have to be replaced and the production will be 50-55 per cent less.

Rubber production will be reduced by 20-25 per cent and coffee may record a deficit of 15-20 per cent.

Which are the commodities that are worst affected?

The maximum damage has been reported from the cardamom sector, especially Devikulam, Udumbanchola, Kumily, Vandiperiyar, Peermade, Elappara and Thodupuzha areas. The storm experienced in the initial phases of the monsoon has caused severe damage to yielding plants, wherein nearly 25 per cent of the yielding plants will have to be replanted.

Extensive damage has been reported to the indigenous shade trees which may take years to replenish.

The high intensity rainfall during the second phase of the monsoon has resulted in an epidemic outbreak of rhizome rot and capsule rot.

It is estimated that production will be 50-55 per cent lower compared to the previous year. The current crop loss alone could be above 400 crore, but as per the estimate, the overall season loss could be above 1,000 crore.

What kind of relief has the government provided to affected growers?

The Government has taken effective steps to rebuild the communication network and healthcare systems on a war footing basis.

As far as the relief measures are concerned, the State Level Bankers Committee has recommended a moratorium on agricultural loans for a period of 12-18 months.

The growers have reported the extent of damage to the concerned revenue authorities. As the magnitude of damages is too severe, long-term relief measures for the growers are yet to be finalised.

Is the relief adequate? Has APK suggested any other relief measures that the Government needs to take up?

APK has requested the Centre to immediately disburse already recognised and pending financial support from all the Commodity Boards to the growers.

It has also requested to declare MSP for all the plantation commodities, as per the formula adopted for cereal crops.

As the damages to production and the ancillary infra structure are too severe, it may not be possible for growers or the State Government to completely fund the reconstruction. Hence, the Association has requested the Central Government to provide a grant for reestablishing the production infrastructure and long-term soft loans for reconstruction of the ancillary infrastructure.

As there has been damage of soil conservation and water conservation facilities, it has been requested that the State extend financial support for rebuilding the same.

For bringing back the natural shade tree canopy, it was requested to provide support through the Social Forestry Scheme for planting trees indigenous to the Western Ghats.

How long do you think the plantation sector would need to get back to normal?

Damages due to the current crisis can be divided as short term as well as long term. We expect tea production to resume by mid-October to early November.

Rubber production may reach normalcy by December, as the majority of rubber trees have defoliated and it may take nearly 60-75 days for normal operations.

As far as the cardamom sector is concerned, the diseases are getting under control and remaining rounds of cardamom harvest will be over by end December/January.

However, replanting of damaged plants may not be completed this year. The black rot identified in coffee has come under control and normal operations may be started by end October.

The plantation sector has been going through severe financial crisis due to the high cost of production and low price realisation since 2012. The majority of the plantations are struggling to raise even working capital.

The extent of current damage is so severe that the plantations have neither the financial capacity nor the economic viability at this point. Moreover whatever crop is already lost, the industry will not be able to recoup.

The majority of damage to infrastructure — both production and ancillary — has created a permanent scar on the face of plantations in Kerala.

As far as the damage to production and ancillary infrastructure is concerned, the resurrection depends on availability of funds and support from the Government as the growers individually may not be able to meet the expenditure.

 
Published on September 19, 2018

 

Tyre firm margins hit as floods impacTyre firm margins hit as floods impact rubber tapping in Kerala

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