In September, the BMP for RSS four grade rubber was increased to Rs 3405 a quintal from Rs 2490 a quintal fixed in February 1994. Similarly, BMP for RSS five was fixed at Rs 3355 a quintal from around Rs 23.

MPs, lead by Kerala Congress (Mani) group MP, K C Thomas, had demanded that government fix SMP for rubber instead of revising BMP, saying it would ensure better prices for growers

Thomas was seeking higher prices for the commodity in the wake of rubber prices slipping to a five year low in April last. Meanwhile, public sector State Trading Corporation (STC) had procured only 2,400 tonnes of rubber of the 20,000 ordered by the government in May.

However, it had finished procuring 10,000 tonnes orderedlast year by the United Front government. The sources said there was no need for STC to procure rubber since BMP had been fixed and the commodity's prices were hovering around that level.

Government, while asking STC to procure rubber, had said the commodity be procured at a rate not above Rs 34 a kg for the RSS four grade. It also allowed STC to buy crumb rubber after ascertaining its quality.

The sources said since prices for RSS four grade was hovering around Rs 3,400 a quintal, growers were not offering their stocks to STC.

However, fear of STC procurement had kept the prices around the BMP level, they said. The government also said the procured rubber would either be exported or sold against advance import licence.

Rubber prices have been dormant since the second half of 1997 on increased production and a decline in domestic consumption, mainly by tyre industry following a slowdown in the transport sector.