November 1, 1918.] 



THE INDIA RUBBER WORLD 



The Plantation Rubber Position. 



By a Special Correspondent 



WITHOUT question crude rubber prices, supply and de- 

 mand are the matters of chief present concern, not only 

 to rubber growers and shareholders, but to brokers, 

 merchants and others vitally connected with the plantation in- 

 dustry. The gradual accumulation of large stocks of crude rub- 

 ber in the East, due to lack of ocean tonnage and the .\merican 

 restriction of imports, together with the consequent continuation 

 of low prices, is causing considerable depression and anxiety. 

 Various circles view the situation in a different light and con- 

 siderable feeling is developing between the several important 

 producing countries. 



Discussion is still rife regarding the restriction of plantation 

 rubber output, but without legislation it would seem to be impos- 

 sible to enforce it. The 20 per cent reduction agreed upon by 

 members of the Rubber Growers' Association, and to which they 

 have adhered to the extent of 70 per cent of the acreage con- 

 trolled by members of the association, has not only failed to 

 stabilize the situation, but has opened the way to so-called 

 profiteering on the part of non-members that vitiates the sacrifice 

 to a considerable degree and greatly complicates an already vexed 

 situation. Sleps of a much more drastic character appear to be 

 necessary if prices are to be restored to anywhere near their 

 former level, but great difference of opinion exists as to what 

 they should be. 



Put briefly, the question for producers is whether to fall in 

 line with the restriction plan of the Rubber Growers' Associa- 

 tion, or to endeavor to acquire as much as possible of the trade 

 that is going. 



Many small producers, and particularly growers in Ceylon and 

 India, assert that the policy of restriction is designed chiefly in 

 the interests of the big Malayan companies which desire to main- 

 tain prices at a high level and let the rubber remain in the trees 

 rather than sell it at 24 or 25 cents per pound, the prices at which 

 the highest grades have been going in Singapore and Colombo. 

 Another group of young producers believe that ocean tonnage 

 is not being allotted fairly and claim that certain large growers 

 and leading merchants have been able to ship considerable con- 

 signments when freight space for groups of small growers was 

 either denied or greatly curtailed. They point out that activity 

 in Eastern markets will be seriously reduced if control of the 

 available tonnage by any group of growers is permitted, and 

 state that it will soon be necessary for Eastern governments to 

 intervene, in order that all individual and company planters shall 

 have shipping facilities in proportion to their possessions. 



It is common knowledge that the Council of the Rubber Grow- 

 ers' Association has approached the British Government with a 

 view to bringing about compulsory restriction of output accom- 

 panied by the fixing of a minimum price in the East. It is 

 claimed that the 20 per cent curtailment covering only part of 

 the acreage in bearing is no longer adequate to meet the situa- 

 tion, but that nearly a 60 per cent reduction is now called for to 

 avert calamity ; also that legislation should be resorted to be- 

 cause those who opposed restriction to any extent might now 

 fail to realize the gravity of the present position. While the 

 British Government is giving sympathetic attention to the pro- 

 posals, it is felt that the negotiations are so protracted as to 

 minimize the relief sought. 



Meanwhile many interested parties are engaged in active propa- 

 ganda and are advocating missions to visit Eastern rubber-pro- 

 ducing countries to promote branch organizations of the Rubber 

 Growers' Association, and make the rupee, dollar and guilder 

 companies and private owners realize that membership in a 



great international organization consisting exclusively of rubber 

 planters is to their interest, in order that a concerted effort can 

 be made to meet abnormal conditions. They assert that had these 

 companies cooperated with the Rubber Growers' Association and 

 curtailed production 20 per cent, the present demoralized con- 

 dition of the market would not have occurred, and they paint a 

 very sorry picture of the future of the plantation industry unless 

 a strong organization representing unity of purpose can be effected 

 quickly. Some London interests apparently feel that better sup- 

 port should be accorded by the East and point out that in the 

 absence of a strong organization that can so control production 

 as to guarantee fair prices, the industry cannot be conducted on 

 sound and permanent lines, and that efforts to improve cultiva- 

 tion, tapping and other estate methods through research will 

 prove of secondary importance. 



The advocates of restricted production appeared to think that 

 curtailment of American imports on the basis of 100,000 tons 

 per annum would quickly settle the matter as they wished. They 

 pointed out that the world's production in 1918 without restriction 

 was estimated at 300,000 tons, and that if America were going to 

 fake only 100,000 tons, and Great Britain only 25,000 tons, the 

 total world's consumption would be only some 160,000 tons, where- 

 as, despite existing restrictions, the rubber output for the current 

 year will not fall far short of 200,000 tons, leaving a surplus of 

 about 40.000 tons. They believed it was clearly the duty of the 

 Straits Settlements and Federated Malay States authorities to 

 prevent the industry which had brought prosperity to Malaya 

 from drifting into financial chaos, and that if the desired results 

 were not forthcoming, the strongest possible pressure should be 

 exerted on the Colonial Office. 



As to the advisability of government control, London interests 

 are by no means agreed, however. Prominent bankers and others 

 have openly said they would rather weather any storm than en- 

 courage government control because it might be exceedingly diffi- 

 cult to shake off that control after the war. In Ceylon and India, 

 too, most producers take the position that if the future brings 

 better results, all concerned will rejoice in not having resorted 

 to panicky legislation to relieve a temporary chaotic condition, 

 but if it is found that there is no chance of the rubber being 

 shipped, they agree that prompt measures will have to be taken 

 by the planters themselves to restrict production. 



Another faction among the large planting interests is openly 

 advocating maximum production and, if necessary, driving small 

 producers into a position little short of ruin. While opponents 

 of this policy admit that rubber growers as a whole will find it 

 exceedingly difficult to meet abnormal market conditions as long 

 as hundreds of small growers are not brought under control, they 

 point out that crushing small and young producers would result 

 merely in a change of ownership, large companies and probably 

 Americans purchasing them and increasing their productive 

 capacity. Complete control of every plantation unit, they claim, 

 is essential to the salvation of the industry. 



American restriction of crude rubber imports figures largely 

 in the calculations. All available information points to the prob- 

 ability that the United Slates Government will only provide rub- 

 ber for war purposes and essential national needs, and that there 

 is little, if any, likelihood of an early relaxation of the present 

 import restrictions. It is felt that the curtailment of pneumatic 

 tire production to SO per cent of last year's output in correspond- 

 ing months may foreshadow similar curtailment in other lines 

 of rubber goods. Furthermore, the ruling of the War Trade 

 Board stipulating that 50 per cent of the imports for August and 



