Friday, August 26, 2011

Climatic conditions, tapper shortage will affect Rubber production-FLCH CEO

By Jithendra Antonio

Despite every possible precautionary measure that is taken by the Plantation Companies to minimize negative impacts on the industry, the adverse climatic conditions and shortage of skilled tappers may affect the Rubber production, according to Free Lanka Capital Holdings (FLCH) Chief Executive Godfrey Aloysius.

In the first annual report that is released to Colombo Bourse, Aloysius in his review adds that some rubber factories have been renovated and developed to handle the production and improve the quality of end product.

However he also notes that the demand for Synthetic rubber would be a determinant of the demand in natural rubber.

Free Lanka Capital Holdings (FLCH) has investments in two Plantation Companies namely Maturata Plantations Ltd and Pussellawa Plantations Ltd through its managing agent companies of Free Lanka Plantations Co. (Pvt) Ltd and Free Lanka Management Co. (Pvt) Ltd. Being subsidiaries of the company, they enjoy the leasehold rights of over 23,000 hectares of Lands located in diversified elevation categories.

 The two plantation companies are primarily involved in the cultivation, manufacture and sale of tea and rubber.

Meanwhile outlining the Tea industry performance Godfrey Aloysius further notes that being a labour intensive Industry, Tea industry continuously sees an increase in Cost of Production particularly on worker wages including the estate staff that has a considerable impact on the viability of the sector.

“The continuous reduction in the worker force due to migration and any worker unrests may affect the day-to-day operations of estates” Aloysius notes adding that the Workers Collective Agreement which had been due for renewal on 01st April 2011 was signed on 6th June 2011 with retrospective effect. Further, he highlights that both Plantations have programmed to undertake new and replanting of rubber with high yielding clones having recognized its profitability and less labour intensive nature of the crop as a long term strategy.

According to Aloysius the volatile situation erupted in Middle East region may affect prices at the Colombo Auction. “The Plantation Companies are taking all measures to improve the quality at all the points of operations, covering the process of cultivation, harvesting and manufacturing” he notes. While the Tea production is vulnerable to adverse weather conditions such as prolong drought spells, heavy rains, very low temperatures ; Aloysius says that the FLCH Plantation Companies have adopted good agricultural practices to mitigate the impacts of adverse climatic conditions as much as possible.

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