With natural price keeping downturn and planters refusing cutting more natural rubber, Hainan government mobilized local planters to buy natural rubber price insurance in Hainan Province.
The insurance promised that if dry NB price is lower than 15 yuan/KG, it will trigger insurance payment mechanism.
The first deal in which natural rubber produced in South China's Hainan Province was inked in Wuzhishan, Hainan Province in June 2018.
The insurance policy rolled out by the Hainan branch of the People's Insurance Company of China covered a total of 2,250 tons of rubber owned by Hainan Rubber Group till December 31, 2018.
Hainan is China's largest production base for natural rubber, producing 150,000 tons of dry rubber annually. However, locally produced rubber has been affected by the impact of imported rubber.
With the new deal, the insurance policy can hedge against price risks, thereby boosting the stability of the local industry.
By November 5, Hainan Rubber Group has insured its 110,000 tons of natural rubber, and was paid about 120 million yuan.
