The Value Chain of Rubber Wood Industry in Kerala: Relative Share of Various Actors

Rubber wood, an alternative to traditional timber and a renewable alternative raw material for wood based industries, is used in the production of high valued products and thereby generate not only additional employment and income but also strengthen the economic linkages in the context of Kerala economy. The value chain of rubber wood is not simple as there are many nodes which lead to inefficiency. Redesigning the role of various actors in the value chain, the potential development of rubber wood industry can be realised. Comparing Secondary Processed Rubber Wood Products (SPRWP) with plywood industry, the most important product in primary processing, it is understood that both the products have good amount of economic linkages with other sectors. The relative share of each actor of the value chain in domestic consumer price reveals the fact that manufacturer has the highest share and it goes up as the product is processed further. The price received by the farmer shows an increasing trend and the share of the farmer comes down as it moves to high valued products. The role of buyers both on governance and upgrading is poor and hence the industry resembles the characteristics of ‘producer- driven’. Among the sub sectors of SPRWP, the EGP furniture generates high employment and creates strong linkage and hence a policy to encourage this high value adding sector can foster the industrial development of the state economy.