Rubber Wood Industry in Kerala
Chapter 3
RUBBER WOOD INDUSTRY IN KERALA
Contents
3.1 Evolution of Natural Rubber
3.2 Global Production and Consumption of NR
3.3 NR in India
3.4. Share of Kerala in Production and Consumption of NR
3.5 Rubber Based Industries in India and Kerala
3.6 Timber Demand and Rubber Wood in India
3.6.1 Wood Import in India 3.6.2 Timber Demand and Production in Kerala 3.6.3 Some Important Aspects OF Rubber Wood
3.7 Production and Consumption of Rubber Wood
3.7.1 World Scenario 3.7.2 Indian/Kerala Scenario
3.8 Structure of Rubber Wood Industry in Kerala
3.8.1 SPRWP 3.8.2 Plywood
Rubber Wood Industry in Kerala
74
RUBBER WOOD INDUSTRY IN KERALA
In the light of the discussion made in the previous chapter on value
chain, it is necessary to analyse the structure of rubber wood value chain in
Kerala. However, it is worthwhile to begin any discussion on rubber wood
with a cursory glance at Natural Rubber (NR). The ensuing section deals
with natural rubber and its evolution. This is followed by production and
consumption of natural rubber, an overview of rubber based industries,
major issues of rubber wood and various aspects of the rubber wood
industry.
3.1 Evolution of Natural Rubber
Natural rubber (NR), one of the most valuable raw materials, was
known to man from very olden days onwards. There is evidence that rubber
was used at an early period in Ethiopia for making play balls and other
objects. From Ethiopia a ball game spread to Egypt and then to Lyndians to
whom Herodotus attributed its invention (Schindrowitz, 1954).The first
Europeans who visited America had described the use of rubber collected
from trees in tropical areas. Latex yielding trees Hevea and Castilla are
common over extensive areas of jungle, and the rubber was used for
making simple household articles. Most of the rubber going to Europe
came from Hevea and especially Brasiliensis growing in the Amazon basin
of Brazil.
Rubber Wood Industry in Kerala
75
The first major advance rubber cultivation was made in the late 19th
century consequent on Britain’s efforts to introduce new cash crops to its
south Asian colonies of Ceylon, India and Singapore. In 1876 Henry
Wichnam, a local planter acting for the British collected Hevea brasiliensis
seeds from the lower Amazon of Brazil and shipped to England where they
were germinated in the Kew tropical herbarium near London. These
seedlings were sent to Ceylon, West Malaysia and India. The NR sector
which evolved under the colonial patronage had an estate system of export
oriented production facilitated by cheaper land, labour, European
ownership, capital and technology.
3.2. Global Production and Consumption of NR
The NR output across world increased from 3000 tonnes in 1860 to
8.70 million tonnes in 2005.The details are given in table 3.1
Table 3.1 Trend in the World Output of NR
Year Output( million tonnes)
1860 0.003
1900 0.045
1910 0.078
1930 0.14
1950 1.89
1990 5.21
2000 6.76
2003 7.97
2005 8.70
Source : IRS , various years
Rubber Wood Industry in Kerala
76
Table 3.1 shows a tremendous leap in the output of rubber since
1930 due to the sharp increase in planted area. The total planted area in 13
top NR producing countries has increased from 9.03 million hectare in
1998 to 9.22 million hectare in 2005 (IRS 2006). The country-wise
production data shows that the rubber wood production is concentrated in
four major countries viz, Thailand, Indonesia, Malaysia and India. It is
shown in diagram 3.1.
Diagram 3.1 Production of NR in Major Producing Countries (Million tonnes)
Source: IRS, 2006
The global consumption pattern of rubber in 2005, shows that out of
the total consumption 42 per cent is NR, and the remaining 58 per cent is
synthetic rubber (SR). It is of interest to note that the share of NR had been
only 35 per cent in 1990.
The relative share of Asia in total NR production has been very
significant as it was found to be more than 85 per cent in 2005. At the same
Mill
ion t
onn
es
Rubber Wood Industry in Kerala
77
time it is to be noted that the relative share of Asia in world NR
consumption was less than 48 per cent during the same year (IRS 2006).
Table 3.2 shows the details of country-wise share in production and
consumption of NR
Table 3.2 Production and Consumption of NR in Major Producing Countries (2005p)
Country/region
Percentage
share in world
production
Percentage
share in world
consumption
Domestic
consumption
as % of
production
Thailand 32.55 3.75 11.64
Indonesia 26.09 2.51 9.73
Malaysia 12.94 4.40 34.36
India 8.87 8.98 102.2
China 4.92 20.80 426
Sub-total 85.37 40.44 48.81
Others 14.63 59.55 52.19
World Total 100 100 -
Source: IRS, 2006 p = provisional
It is made clear in table 3.2 that Thailand has the highest share in NR
production but their share of consumption in percentage of their production
is only 11.64 per cent. China’s share in world production is only 4.92 per
cent but their consumption of NR is 426 per cent of their production. In
India the production is only 8.8 per cent of the world output of NR but our
consumption in percentage of production is 102 per cent. Forty four
percent of the NR consumption in the world is done by China the US and
Japan whereas India’s consumption is 8.98 per cent. A detailed account of
NR in India is given in the ensuing section.
Rubber Wood Industry in Kerala
78
3.3. NR in India
The history of NR in India is the history of NR cultivation in Kerala.
India is mainly responsible for the introduction of NR to the east. It was the
Indian office in London that financed Sir Henry Wickam’s expedition to
the Amazon valley in Brazil to procure rubber seeds in1876. With the
invention of pneumatic tyre and the development of internal combustion
engines by the close of 19th century, a frantic effort was made all over the
world to obtain more rubber. The increased demand (and the resulting
shortage in supply) raised the price of rubber to an all time record in 1910.
By then Mundakayam in Kerala had become the leading centre of rubber
plantations in India, with an area of 4000 hectare. This was around half of
the area under rubber plantations in the country. This exorbitant price led to
a scramble for planting rubber in the west coast of India. But during the
depression years the Indian rubber industry faced a severe fall in rubber
prices and new plantations were severely limited in order to prevent further
expansion of production capacity. Replanting was also strictly limited. By
1942 the situation in India had changed drastically. The conquest of
Malaya and other South East Asian countries by Japan had left the allied
nations with India and Ceylon for obtaining rubber. This situation brought
about a complete transformation in the prospect of rubber plantation in
India. As a result of several measures adopted by the Government of India,
a spurt in planting activities occurred between 1943 and 1946.
Rubber Wood Industry in Kerala
79
After the World War II a conference of rubber producing interests
was organized by the rubber growers and the Government. On the basis of
the recommendations, the government decided to set up the Rubber Board
of India to look after the development of the rubber plantation and rubber
industry. As per the Rubber Act of 1947, rubber plantations over 20.23
hectares (50 acres) under a single ownership is treated as estates, and those
whose area ranges up to 20.23 hectares are treated as holdings. Table 3.3
shows the composition of rubber cultivation in India.
Table 3.3 Classification of Holdings and Estates According to Land Size
Year Holding Estate Grand total
Units (lakh)
Area (lakh
hectares)
Units (lakh)
Area (lakh hectares)
Units (lakh)
Area (lakh
hectares)
1955-56 0.27 0.36 446 0.46 0.27 0.82
1960-61 0.57 0.76 547 0.54 0.58 1.30
1980-81 1.95 2.09 553 0.69 1.96 2.78
1990-91 7.81 3.97 332 0.78 7.81 4.75
1999-00 9.86 4.90 321 0.68 9.87 5.59
2004-05 10.29 5.18 273 0.66 10.29 5.84
Source: Compiled from IRS.Vol.18, 29.
It is clear from table 3.3 that there has been an increasing rate of
planted area devoted to rubber in the small holding sector.
During the 1950s and 1960s, large scale expansion of rubber
cultivation took place in response to the move in the state of Kerala for
imposition of a ceiling on land holdings from which rubber plantations
along with other plantations were exempted. Prevalence of a steady and
Rubber Wood Industry in Kerala
80
remunerative price for rubber, diversion of extensive areas under disease
infected coconut plantations in central Kerala to rubber plantation,
intensification of R&D programmes by the Rubber Board during this
period etc. also contributed to the increase in production of rubber.
As a result of industrial recession during the 1970s the area newly
planted fell to 52000 hectare in 1970 from 82000 hectare in the 1960s. By
1979-80, given the short fall in the NR supply in the years to come, an intensive
rubber production drive was launched by Rubber Board and others for stepping
up the rubber production. In 1979-80, for the first time a subsidy-cum credit
scheme was introduced on a pilot basis for encouraging new planting. Noticing
the excellent response to the scheme, an integrated scheme known as Rubber
Plantation Development Scheme was launched in 1980-81 for accelerating new
planting and replanting. The area under cultivation increased from 0.75 lakh
hectare in1950-51 to 5.84 lakh hectare in2004-05. The details of the trend in the
production of estates and holdings is given in table 3.4
Table 3.4 Production of Holdings and Estates in India ( lakh tonnes)
Year Holdings Estates Total
1950-51 0.03(21.4) 0.12(78.6*) 0.16
1960-61 0.06(25.4) 0.19(74.6) 0.26
1970-71 0.52(55.86) 0.41(44.14) 0.92
1980-81 1.08(70.4) 0.45(29.6) 1.53
1990-91 2.68(81.46) 0.61(18.54) 3.29
1999-00 5.45(87.52) 0.78(12.48) 6.22
2004-05 6.86(91.46) 0.64(8.54) 7.50
Source: Compiled from IRS. Vol.19, 29 *percentage share in parenthesis
Rubber Wood Industry in Kerala
81
It is evident from table 3.4 that the share of small holdings in total
output increased from 21.45 per cent in 1950-51 to 91.46 per cent in 2004-05.
Though the share of estates in total production declined, the absolute level of
production increased from 0.12 lakh tonnes to 0.78 lakh tonnes in 1999-00.
However, in 2004-05 estate production declined to 0.64 lakh tonnes.
Although India faces sub-optimal agro-climatic conditions compared to
other major NR producing countries, it has the highest yield per hectare. This
mainly owes its credit to the excellent work done by Rubber Research
Institute of India (RRII). This institute carries out comprehensive research on
all aspects of rubber. Among the major achievements of RRII, breeding and
selection of high yielding clone RRII 105 is foremost. Another factor which
contributed to this highest yield per hectare is the receptivity of the Indian
growers to modern technology. Over the last fifty years the productivity of
rubber in India has increased from 300 kgs per hectare to 1479 kgs (IRS).
3.4. Share of Kerala in production and consumption of NR
A comparison of the production and consumption of NR in India and
Kerala is given in table 3.5
Table.3.5 Area /Production/Consumption of NR in Kerala
Area, Production,
consumption
India Kerala % share of Kerala
90-91 04- 05 90-91 04-05 90-91 04-05
Area (lakh hectare) 2.17 5.84 1.98 4.85 91.2 83.15
Production(lakh tonnes) 3.29 7.49 3.07 6.9 93.29 92.1
Consumption ( lakh tonnes) 3.64 7.55 0.55 1.25 15.11 16.55
Source: IRS, 2006.
Rubber Wood Industry in Kerala
82
It is clear from table 3.5 that the share of Kerala in NR production
was 93.29 per cent in 1990-91, but it declined to 92.1 per cent in 2005. At
the same time the gross production increased from 3.07 lakh tonnes to 6.9
lakh tonnes during the same period. The area of production also increased
from 1.98 lakh hectare to 4.85 lakh hectare in 2004-05 though Kerala’s
share in India declined from 91.2 per cent to 83.1 per cent during the same
period. India is the fourth largest consumer of NR in the world after China,
the US and Japan. Though Kerala produces 92.1 per cent of the rubber in
India, its consumption was only 16.56 per cent in 2004-05.
3.5. Rubber Based Industries in India and Kerala
It has already been stated that the Kerala holds a monopoly in the
growing of NR though its consumption is comparatively low. The major
explanatory variables attributed to the observed trends in production and
consumption are historical and structural factors, higher wages, inadequate
infrastructural facilities and institutional support and deficiencies of the local
entrepreneurship (Govt, of Kerala, 1984; Subramanian and Pillai, 1985; Issac
and Tharakan, 1986; Thampi, 1990; Mahadevan, 1991; Mathew, 1999).
The major guidelines emerging from the Malaysian experience for
formulating an appropriate rubber based industrial planning in Kerala shall
include selection and promotion of rubber products for the global market
with higher NR and labour contents, high value addition, free of import
restrictions, negligible brand loyalty and flexible delivery schedules. In the
Rubber Wood Industry in Kerala
83
present context, the value addition foregone from the two major by-
products of rubber plantations in Kerala, viz; rubber wood and rubber
honey is estimated to be more than Rs.29000 million. Therefore, a
conscious policy intervention based on perspective planning has to
integrate the industrial potential of rubber products and by-products in
Kerala (George, 2005).
Since rubber wood is a major by-product of rubber plantations, it is
inevitable to analyse the role of rubber wood in timber industry. The
Analysis of the timber demand and imports in India will give the
background for justifying the role of rubber wood in timber industry.
3.6. Timber demand and Rubber Wood in India
The industrial wood production in the primary processed sector (log,
sawn size, veneer, plywood) increased from 21.4 million m3 in 2002 to
33.85 million m3 in 2005. The industrial wood demand is likely to grow
from 58 million m3 in 2005 to 153 million m3 in 2020 (ITTO, 2005). Due
to the shortage of timber, the capacity utilization of organized sector of
plywood industry in India declined from 64 per cent in 1967-68 to 33 per
cent in 2001- 02. Ecological considerations led to several constraints
imposed by Supreme Court which accentuated the problem further. This
compelled the country to import timber from other countries on the one
hand and to seek alternatives like rubber wood on the other.
Rubber Wood Industry in Kerala
84
3.6.1 Wood Import in India
India is one of the largest importers of logs in the global trade. India
and Japan accounted for 68 per cent of the reported log export volume in
2003 (ITTO). In fact, India is now the second largest importer of tropical
log, overtaking Japan for the first time in 2003 with imports of just over 2.4
million m3, which is up 10 per cent from 2002 levels. The import of
primary processed wood was 3.75 million m3 in 2005. The trends in the
import of wood logs and wood products are given in table 3.6.
Table 3.6 Trends in the Import of Wood Logs and Wood Products ( Rs. crore )
Item 2002-03 2003-04 2004-05
Wood logs 1603.39 3068.14 3685.47
Sawn timber 34.18 56.60 59.50
Veneer 15.99 16.55 22.03
Particle board 34.64 60.87 75.32
MDF/Hard board 48.76 60.05 78.05
Plywood 16.88 19.31 22.83
Wooden furniture 32.25 56.32 74.95
Source: Directorate General of Commerce Intelligence and Statistics, Kolkotta
It is evident from table 3.6 that when compared to 2002-03 the
import bill of wood logs increased by 130 per cent in 2004-05 .The import
of wooden furniture increased by 132.4 per cent during the same period.
The trends in the import of wood logs is shown in diagram 3.2
Rubber Wood Industry in Kerala
85
3685
3068
1603
2431
2092
1860
1428
1436.9
2
755.5
2
875.7
1
0
500
1000
1500
2000
2500
3000
3500
4000
1995-
96
1996-
97
1997-
98
1998-
99
1999-
00
2000-
01
2001-
02
2002-
03
2003-
04
2004-
05
Year
Valu
es (
Rs C
rore
)
Diagram 3.2 Import of Wood Logs (Rs. crore)
Source: Directorate General of Commerce Intelligence and Statistics, Kolkotta
It is clear from diagram 3.2 that the import of wood logs declined in
2002-03 but it again increased in 2003-04 and 2004-05.
3.6.2. Timber Demand and Production in Kerala
Out of the annual production of 14.6 million m3 of wood in the state,
about 83 per cent was from homesteads, 10 per cent from estates and seven
per cent from forests. Although Kerala was a net exporter of hardwood
timber, presently about 50 per cent of its wood requirement in cities are
met from import. It is estimated that the volume of timber import to the
state is to the tune of Rs. 500 crore per annum ( FAO, 2005).
In this context, the utilization two million m3 rubber wood from
Kerala for the production of value added wood products is significant in
reducing the import bill, bringing down the rising price of timber,
generation of additional income through value addition etc. Rubber wood
has started playing an active role not only in India but also in other parts of
Rubber Wood Industry in Kerala
86
the world. Therefore it is worthwhile to analyse some important aspects of
rubber wood.
3.6.3 Some Important Aspects of Rubber Wood
The most distinctive feature of rubber wood is that it is a renewable
by-product of rubber plantations. The supply of rubber wood is
inexhaustible as the plantations are maintained on a sustainable yield
rotation of 25-30 years. Rubber wood has traditionally been used as a
cheap source of fuel wood in most of the countries where rubber
plantations are abundant. It is also used industrially for brick burning and
tobacco curing. Owing to its lack of durability the wood was not
traditionally used as timber except in timber-scarce countries such as India
and Sri Lanka, where it has been used for general utility purposes.
In fact rubber wood is not much useful in its pure form. The proper
treatment and seasoning of this wood make it commercial and useful for
industrial purposes. (The treatment and seasoning of rubber is explained in
appendix 2 and 3). Being naturally non-durable, rubber-wood is not
economically usable without preservative treatment. Through research and
development efforts protective measures have been prescribed which are
now routine for rubber wood processing.
The average production of rubber wood per hectare is 150 m3.
Rubber wood even after chemical treatment costs much less than other
timbers and will have a service life ranging from 25 to 100 years,
Rubber Wood Industry in Kerala
87
depending on the method of treatment. Rubber wood is a homogeneous,
pale straw coloured wood with a density of 456-620 kg/m3. The wood has
straight grains and medium texture without any characteristic odour. The
strength properties of rubber wood are comparable to sal indicating that it
is sufficiently suitable for packing cases and crates, dunnage pallets, match
veneers, splints, hardboard and compressed wood shuttle blocks. Being a
moderately steady timber, it is suitable for ordinary furniture and bend
wood items, doors and window frames and shutters, provided it is properly
seasoned and chemically treated. Rubber wood is fairly easy to re-saw,
cross cut, plane turn and mortise. It has good machining properties for
making furniture, door and window components. Rubber wood has good
nail and screw holding capacity. Painted surface of rubber wood performs
well. Studies on finish adaptability have indicated that rubber wood can be
spirit polished satisfactorily using turkey amber coloured chalk powder
base to obtain good appearance.
Freshly felled rubber wood logs contain moisture even up to 65 to
75 per cent of weight of solid dry timber. Due to the presence or movement
of moisture in wood and particularly if it is not uniformly distributed,
differential stress are developed in different parts of the wood.
Consequently cracks, shrinkage, warping etc. develop in the material and
hence it is always necessary to bring down the moisture to a uniform level
by seasoning.
Rubber Wood Industry in Kerala
88
Rubber wood is highly susceptible to sap stain, fungi, and insects
and it can be controlled by proper treatment. However, the presence of
tension wood results in warping. Therefore, only selected wood can be
used for furniture, door and window frames and shutters. The problems of
warping and bending are now solved to a great extent by the production of
finger jointed boards.
As rubber wood is a non-durable timber and shows some tendency to
surface cracking, warping, bowing and end splitting, it should be properly
seasoned and of treatment. Salleh (1984) reported 61 different products
made from rubber wood. It’s most important uses are in furniture and
furniture parts, parquet, paneling, wood-based panels (particle board,
cement and gypsum-bonded panels, medium-density fiber board and Edge
Glued Panel board), modified timber, improved timber and wood polymer
composite. Edge Glued Panel boards (EGP) are recently produced in India
using rubber wood sawn sizes, while wood polymer composite and
modified timber are not commercially produced in India.
A disadvantage of rubber wood is the smaller sizes available compared
with timber from forest species, which is now overcome by producing EGP
boards and particle boards. The development of appropriate processing
technologies capable of improving the inherent properties of rubber wood
made it a sustainable substitute for conventional hardwood species on a
variety of end uses and contributes to the environmental conservation.
Rubber Wood Industry in Kerala
89
3.7 Production and Consumption of Rubber Wood 3.7.1. World Scenario
As 95 per cent of the rubber cultivation in the world is in Asian
countries, the production and processing of rubber wood is also mainly
concentrated in Asia, particularly Malaysia, Indonesia, Thailand and India.
The inexpensive wood from plantation rubber trees, which are felled when
they no longer yield adequate latex, is finding a market in high-value end
products traditionally associated with more valuable hardwoods such as
teak and rose wood. In 1990 the total annual available volume of rubber
wood in the area of the Association of Southeast-Asian Nations (ASEAN)
was estimated to be about 17 million m3 (Ser, 1990).
More than 80 percent of the 7.2 million hectare of plantations
established worldwide for latex production in 1999 is in Southeast
Asia. Seventy percent of the total plantations (or 5.2 million hectare) is
in Indonesia, Malaysia and Thailand (FAO, 1999). For decades,
Malaysia had the largest area, followed by Indonesia and Thailand.
With increasing wages and decreasing rubber prices in Malaysia,
labour-intensive production of natural rubber in larger estates is slowly
shifting to lower-wage countries in the region, while in Malaysia
plantations are increasingly replanted with oil-palms (Elaeis
guineensis). The trends in Malaysian rubber cultivation from 1991 to
1998 are shown in table 3.7.
Rubber Wood Industry in Kerala
90
Table 3.7 Area Replanted with Rubber Trees in Malaysia (thousand hectare)
Year Hevea Other crops Total Hevea in
total (%)
1991 31. 50 7. 70 39. 20 80
1992 33. 00 8. 40 41. 40 80
1993 31. 10 10. 40 41. 50 75
1994 26. 10 12. 80 38. 90 67
1995 22. 90 14. 00 36. 90 62
1996 21. 60 13. 00 34. 60 61
1997 11. 30 13. 00 24.30 47
1998 9. 10 11. 00 20.10 46
1998 9. 10 11. 00 20.10 46
Source: FDM Asia (1999).
It is evident from table 3.7 that the area under rubber replantation in
Malaysia declined from 80 per cent in 1992 to 46 per cent in 1998.
However, rubber wood sawing and downstream processing industries in
Peninsular Malaysia are well developed. In 1993, 116 stationary and 26
mobile sawmills i.e. 20 percent of Malaysian saw mills processed only
rubber wood (MPI, 1993). In addition, rubber wood has been used as the
raw material for a growing panel industry. In the 90s there were four
particleboard mills, four molded particleboard mills, one wood cement
board mill and seven medium-density fiber board mills use primarily
rubber wood (Forestry Department, Peninsular Malaysia, 1998). The
number of mills has increased from 148 in 1982 to more than 3500 in 2000.
The price of rubber wood has risen from US $150 per m3 in mid 1980s to
U.S $ 225 per m3 in 2000. Rubber wood furniture accounts for 80 per cent
Rubber Wood Industry in Kerala
91
of the furniture export from Malaysia. About five per cent of the furniture
manufacturers are large, but they contribute 70 per cent of the industrial
output (Ratnasingam, 2003).
The trend in the export of rubber wood furniture in Malaysia is
given in table 3.8
Table 3.8 Exports of Rubber Wood Furniture from Malaysia (US $ million)
Year Export ($million)
1991 74.2
1992 106.0
1993 197.1
1994 297.4
1995 502.4
1996 439.8
1997 532.7
1998 683.3
Source: Malaysian Timber Industry Board Statistics cited in FDM Asia (1999)
In Malaysia, rubber wood has outperformed some of the traditional
furniture timbers in export earnings. In 1994, exports of rubber wood
furniture brought in US $ 297 million, accounting for 70 percent of
Malaysia's furniture exports. In 1998, the country exported about US $ 683
million worth of rubber wood furniture (Table 3.8).
Exports of sawn rubber wood from Malaysia increased from 903 m3
valued at US $35,000 in 1979 to 2,21,361 m3 valued at US $10.5 million in
1989, which indicates the tremendous potential of this timber. In order to
Rubber Wood Industry in Kerala
92
promote the development of the downstream rubber wood industry for
added value, Malaysia introduced an export levy of 120 Ringgit (M$) per
m3 (US$33.3) on sawn rubber wood. This resulted in a decline in exports of
the sawn timber to 103 478 m3, valued at US$13.3 million, in 1990 and to
71 261 m3, valued at US$11.9 million, in 1991. However, the levy
achieved its goal. Since exporting sawn timber was less advantageous and
the export of further processed rubber wood products was not taxed,
Malaysians invested in downstream processing. Together with the
increasing international demand for rubber wood products, the levy thus
triggered an investment boom in the Malaysian rubber wood industry as
well as an increase in export of processed products (Table 3.8) which more
than compensated for the reduced export of sawn rubber wood.
Some of the large international furniture companies, such as IKEA,
have been sourcing rubber wood products from Malaysia since the early
1990s for distribution to their customers worldwide. Some of these large
companies have linked up with furniture manufacturers to ensure that the
supply of rubber wood products meets the companies' quality and design
requirements; such linkages facilitate the transfer of technical skills and
knowledge to local manufacturers.
Some confusion may be caused by the variety of names under which
rubber wood is marketed. It has been called rubber wood, para wood, hevea
wood, hevaru, Malaysian ash and Malaysian oak. The latter two are
Rubber Wood Industry in Kerala
93
misleading, giving the impression of similarity in properties to oak or ash.
It would be beneficial to adopt a universally accepted common name for
the timber to avoid wrong expectations by consumers. In the past it has
been suggested that the name hevea wood be used but it is not in use at
present. However to dispel the cheap image associated with the material,
rubber wood has been officially renamed as ‘Malaysian White Oak’
in 2002.
The rubber wood sawn timber industry in Thailand is well
developed, with a total of about 100 mills. Downstream rubber wood
processing is experiencing very rapid growth, which is attributable in part
to the depletion of the country's natural timber resource, the logging ban in
natural forests and the diminishing supply of teak. Since a large portion of
the sawn wood produced in Thailand is processed and used locally (Ser,
1990), Thailand's exports of sawn rubber wood timber are insignificant
when compared with those of Malaysia.
In Indonesia, attempts were made in the early 1980s to develop a
rubber wood sawmilling industry to supply sawn-timber to Singapore,
Japan and Taiwan Province of China. Because of subsequent unfavourable
government policies and regulations and a continuous demand for
indigenous timbers, the industry did not develop significantly at that time.
However, since the 1980s a rubber wood processing industry has been
developing in Indonesia.
Rubber Wood Industry in Kerala
94
3.7.2. Indian/ Kerala Scenario
As 83 per cent of the area of rubber cultivation in India is in the
state of Kerala, the discussion need to focus primarily on the
production of rubber wood in Kerala. Until 1960s rubber wood was
generally regarded as a non- durable wood, and was mainly used as
firewood. The steady rise in demand for timber and the dwindling
sources of supply resulted in increase in the prices of conventional
species. Consequently, from the late 1960s onwards rubber wood began
to be used as the next best alternative for making packing cases. The
rise in favour of rubber wood entered a new phase when it began to be
used in the match industry. From mid 1980s the plywood sector also
began to use rubber wood and the practice became extensive since
1990. However, the status of rubber wood underwent significant
changes by adopting appropriate technologies for converting the timber
for a variety of industrial applications. Though secondary processing of
rubber wood in Kerala was started during the 1960s (with the
establishment of two processing units, one each in Kottayam and
Trichur districts) the industrial activity on a commercial basis marked
tremendous growth only during the early 1990s.
It is reported that in 1993 there were 31 secondary rubber wood
processing units in India out of which 26 units were in operation with
pressure impregnation and kiln drying facilities (Joseph and George, 1996).
Rubber Wood Industry in Kerala
95
There was a further spurt in rubber wood processing activity and the
number of units in India increased to 50 in 1996. The survey conducted by
Viswanathan et al. in 1995-06 covered 42 processing units located in
Kerala, Tamilnadu and Karnataka. The findings of the survey is given in
table 3.9
Table 3.9 State-wise Distribution and Growth of Rubber Wood Processing Sector in India
State
No. of
units in
operation
Established
between
1960-90
Established
between
90-96
Small
units Others
Total
Surveyed
Kerala 36(72) 11 17 19 9 28
TN 9(18) 2 7 6 3 9
Karnataka 5(10) - 5 0 5 5
Total 50(100) 13 29 25 17 42
Source: Viswanathan et al., 2000
Figures in parenthesis denote percentage
The other major findings of the above survey are the following.
a. Seventy nine per cent units had tertiary processing like furniture,
door, furniture components and other moldings
b. Total estimated installed capacity was 57.79 m3.
c. The average capacity utilization was 51 per cent
d. High proportion of indirect procurement of rubber wood (66% of
logs and 82% of sawn timber)
e. Thirty three per cent of units exporting finished products.
Rubber Wood Industry in Kerala
96
The various products from rubber wood is given in table 3.10
Table 3.10 Products Manufactured with Rubber Wood (1995-96)
Type No. of units Percentage*
Furniture and furniture components 17 40
Paneling, shutters, doors, windows and door frames 13 30
Flooring tiles, brush backs/handles, table tops 11 26
Other components, moldings 11 26
RSKD,S4S 9 21
Source: estimates of RRII * Percentage exceeds 100 because the same unit produces more than one product.
George et al.(1995-96) estimated the current and potential value
addition in Indian rubber wood sector. The estimate was based on
current and potential pattern of consumption of stem wood, extent of
value addition, recovery rates and waste disposal and prevailing prices
of logs of different girth measurements and different types of rubber
wood based end products in the world market. The details are given in
table 3.11.
Table3.11 Current and Potential Value Addition in Indian Rubber Wood Sector 1995- 2006 ( Rs. crore)
Value addition Current Potential
Gross value added Rs.836.26 crore Rs. 3506.12 crore
Net value added Rs. 625.13 crore Rs. 3294.99crore
Extent of vale addition in % 296% 1561%
Value added foregone - Rs.2669.86 crore
Log level value of stem wood Rs.211.13 crore
Source: estimates of RRII
Rubber Wood Industry in Kerala
97
3.8. Structure of Rubber Wood Industry in Kerala
The rubber wood processing in India can be broadly classified into
two; primary processing and secondary processing. The primary processing
consists of saw milling and peeling, sawn planks, packing cases, safety
matches and plywood. The two important features of the primary market
are: i) dominant role of intermediaries ranging from logging contractors to
the saw millers and ii) a comparatively low level of vertical integration.
The saw mills processing rubber wood in India have an inbuilt arrangement
to manufacture packing cases/ packing case materials. Around 90 per cent
of the sales of saw mills consisted of packing cases and packing case
materials, and only 10 per cent was used as sawn planks for secondary
processing. Eighty percent of the peeling units operating in the primary
processing sector are engaged in peeling and marketing of the veneer.
Twenty percent of the peeling units have plywood manufacturing facility
(George 2002). Though the share of secondary processing units in rubber
wood consumption increased from 2.2 per cent in 1984-85 to 12 per cent in
1999-2000, the primary processing sector has a predominant position.
However, since SPRWP and plywood have greater value addition these
sectors are discussed separately in the following sections.
3.8.1. SPRWP
Secondary processing represents processing the sawn timber by
chemically treating and seasoning the sawn planks into Rough Sawn Kiln
Dried (RSKD), and then to Four Side Surface planed sawn planks (S4S).
Rubber Wood Industry in Kerala
98
Some firms use the S4S directly to manufacture value added furniture, door
and other products and components. Some firms use S4S to produce Edge
Glued Panel boards (EGP boards), and these boards are used to produce
furniture and components, building materials (doors, paneling, shutters,
windows and door frames, flooring tiles etc.), industrial components
(textile bobs, brush backs, handles etc.).
Immediately after sawing the rubber wood, it is first treated
chemically to protect it from the attack of fungi and insects with suitable
wood preservative in cylindrical chambers with facility to create and
maintain vacuum pressure. The porous anatomical structure of the tree
makes it amenable to chemical impregnation process which takes three to
four hours to complete. The details of chemical impregnation are given in
appendix.2
Immediately after preservative treatment the wood is subject to
seasoning to bring down the moisture content from 60 per cent to about 10
to 12 per cent. Seasoning done at controlled conditions of temperature and
humidity ensures uniform drying of wood. The details of seasoning are
given in appendix-3.Being a short rotation plantation timber with low girh,
availability of wider and longer planks/sections of rubber wood is difficult.
The innovation of EGP boards has revolutionized the SPRWP sector
in this aspect. Certain defects of RSKD such as tension wood, warping and
bending have been rectified by finger jointing small sizes of rubber wood.
Rubber Wood Industry in Kerala
99
Since rubber wood is comparatively of low girth, and there are large
sections with short length, these sections can be effectively used in
secondary processing through finger jointing. EGP boards have more
strength and durability and also greater width and length when compared to
RSKD. It is available in 8 x 4 feet size with thickness varying from 9 mm
to 48 mm. By virtue of these advantages of EGP boards have been
increasingly used in door, office/shop furnishing, Kitchen/bedroom
paneling and furnishing, furniture etc. Another advantage of EGP board
against Plywood/particle board/MDF board is that any type of carpentry
and designing work can be done on these boards. It is also available in
original rubber wood colour or in any stained form (eg. rose wood /
teakwood). Moreover, lamination helps to conceal the joints.
Though the production of EGP boards with rubber wood started in
Malaysia in early 1970s, and the production of it in India started only in
1989 when the VR Wood Treats Public Limited, a 100% exporting unit,
was set up in Cochin Export Processing Zone. This was followed by the
emergence of another unit named Park Engineering, Cochin in 1994 and
Andamans Timber Industries Limited in Thalassery in 1996. By 2001-02
Rubber Board Started its own unit with the brand name ‘India Wood’ in
Kottayam to manufacture doors with EGP boards on a large scale. Another
large scale unit came into existence in 2001 (Rubco Huat Private Limited,
Thalassery ) for the manufacture of EGP boards (Rubwood) and furniture.
At present there are 12 EGP making units in Kerala, out of which 6 units
Rubber Wood Industry in Kerala
100
are producing other value added products like furniture and door in
addition to EGP. The Finger Jointed Rubber wood Manufacturers’
Association in India (FIRMA) came into existence in 2007 with its head
office in Cochin for the promotion of the sector and there are 14 members
in it. The details of manufacturing EGP boards, its advantages and current
prices are discussed in appendix-4.
3.8.2 Plywood
Plywood is made by gluing together a number of thin veneers or
plies of softwood or hardwood. There are always an odd number of veneers
and each ply is at right angle to the one below, lending greater strength to
the product. The more veneer used, the stronger the plywood becomes. The
suitability of a sheet for a particular application is determined by the type
of glue and veneer. The different varieties of plywood available in the
market are MR grade plywood (moisture resistant), BWR (boiling water
resistant), BWP (boiling water proof), commercial grade, film faced
dandified plywood, decorative laminations, flush door, block board, air
craft plywood, marine plywood, structured plywood, interior plywood,
exterior plywood, shuttering plywood etc. Plywood is environment friendly
as it is a natural product made from renewable resource. Pound to pound,
plywood is stronger than steel in static bending strength. What makes
plywood so strong is its unique cross layered structure. The adhesive used
to bond the veneers in plywood are actually stronger than the wood itself.
The plywood manufacturing process achieves a more complete utilization
Rubber Wood Industry in Kerala
101
of the log than lumber manufacturing. No saw dust results from either
rotary cutting or slicing. (The different stages in the plywood processing is
given in appendix 5)
A great variety of products in various sizes and shapes can be
manufactured from plywood like chair backs and seats, domes, bowling
alley channels, pianos etc. Plywood was first introduced in India as a
packing material to pack tea (Chirayath, 1966). Towards the close of 19th
century a large number of tea estates were set up in Assam, West Bengal
and Kerala. The requirements for tea chest plywood grew steadily and the
value of imports increased from about Rs 23 lakh in 1906-07 to 90 lakh by
1924-25. The tea industry experienced great hardship during the periods of
the two world wars when import of tea chest plywood could not be made
from Europe due to shipping difficulties. The 2nd world war gave a great
fillip to the setting up of indigenous plywood industry. During this period
and the period closely following the war years, a large number of factories,
both big and small, emerged, first for the manufacture of tea chest plywood
and subsequently for many other diversified products.
The first plywood factory in India was established in Assam in 1918.
The number of approved plywood factories in the country has increased
from three at the beginning of the World War II to 71 in 1965 (Chirayath
1966). The number of registered plywood factories in India was 4235 in
1999-2000. Registered manufacturers account for 15 per cent of the total
Rubber Wood Industry in Kerala
102
plywood produced in India, producing approximately 30 million m3 of
plywood and block boards annually. Due to various reasons the production
of commercial plywood in India declined from 9.8 million m3 in 2001-02 to
5.37 million m3 in 2004-05(CSO, 2005). The capacity utilization in Indian
plywood industry is given in diagram 3.3
53
51
47
55
59 60
64
56
42
34
32 33
0
10
20
30
40
50
60
70
1990-
91
1991-
92
1992-
93
1993-
94
1994-
95
1995-
96
1996-
97
1997-
98
1998-
99
1999-
00
2000-
01
2001-
02
Year
Perc
enta
ge
Diagram 3.3 Capacity Utilization in Plywood Industry in India (%)
Source: Industrial Data Book 2002-03 CIER
It is made clear in diagram 3.3 that the capacity utilization of the
plywood industry in India declined from 64 per cent in 1996-97 to 33 per
cent 2001-02. This is mainly due to the shortage of forest wood.
The first plywood factory in Kerala was established in Kallai in
1937. As on 31-12 1980 there were 513 plywood, splints and veneer units
in Kerala (Economic Review 1990). The details of plywood units in Kerala
at present is given in table 3.12
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103
Table 3.12 Details of Plywood Units in Kerala (registered SSI)
Product name No of units Gross output
2001-02
(Rs. crore)
Employment
up to
2002
up to
2006
up to
2002
up to
2006
Plywood and veneer 474 549 110.49 4700 5392
Flush door 51 69 4.13 384 503
Other plywood 58 94 5.76 627 886
Plywood chests 17 19 2.65 138 151
Source: Report on 3rd All India Census on SSI in Kerala 2003-04 and Directorate of
Industries and Commerce, 2007.
It is evident from table 3.13 that the total number of plywood and
veneer units in Kerala increased by 21.83 per cent between 2002 and 2006
(600 to 731). The increase is made possible by the availability of rubber
wood in Kerala. Rubber wood is used as the core veneer, especially in the
production of commercial grade plywood (Price details given in appendix
6). The total employment also increased by 18.5 per cent during the same
period (5849 to 6932). In 2004-05 there were 59 plywood units from
Kerala which exported plywood. The details of export of plywood from
Cochin port is given in table 3.13.
Table 3.13 Plywood Export from Cochin Port in Kerala
Year Export(Rs. crore) Export( m3
) Export (tonnes)
2001-02 6.85 6923.80 3934.27
2002-03 14.32 14459.34 8358.80
2003-04 19.21 19404.00 11025.46
2004-05 30.23 30536.00 24300.00
2005-06 68.45 69129.64 39314.54
Source: CCCI, 2002-06
Rubber Wood Industry in Kerala
104
It is evident from table 3.13 that the export of plywood from Kerala
increased by 900 per cent between 2001-02 and 2005-06. The annual
average increase in export was 81.76 per cent, with 57 per cent in 2004-05
and 126 per cent in 2005-06 when compared to the previous years.
To conclude, the acceptance of rubber wood as a sustainable,
plantation-grown, ‘environment friendly’ timber has contributed to its
universal appeal. Strong research and aggressive marketing have
contributed towards making rubber wood as the most important Southeast
Asian export timber. The domestic utilization of rubber wood has grown up
due to the increase in the number of rubber wood processing units, though
it has yet to utilize its potential. Looking at the existing nature of value
chain of rubber wood and the possibility for developing it further so as to
realize its potential growth, an investigation of rubber wood in Kerala is
inevitable. The next chapter is an attempt towards that direction.