Kerala Plantation Corporation diversifies aimlessly, grows only debt

When the rubber prices crashed, the plantation corporation decided to diversify into other verticals, but all the businesses are bleeding the company barring the rambutan plantation.
File - A fruit vendor selling rambutan at Chalai in Thiruvananthapuram. (Photo | EPS, B P Deepu)
File - A fruit vendor selling rambutan at Chalai in Thiruvananthapuram. (Photo | EPS, B P Deepu)

KASARAGOD: A group of workers affiliated with the CPM and the Congress have given up their work and were sitting in protest in front of the office of the Plantation Corporation of Kerala (PCK) at Cheemeni in Kasaragod district for the third day on Sunday.

Their demand: Bring back a Kasaragod dwarf cow and two calves that were shifted to PCK’s ‘hi-tech’ dairy farm in Ukkinadka in Badiadka panchayat. The Plantation Corporation of Kerala — which has been in the red for the past seven years — thought it was not prudent to employ a worker with all benefits to take care of just one cow.

But the workers in Cheemeni would not have any of it. They blocked the move and on Friday the Plantation Corporation retaliated by suspending four workers. It then shifted the dwarf and its calves to the Ukkinadka farm with police protection. What is currently happening at Cheemeni is just a primer of the problems facing PCK, whose main income comes from rubber and cashew plantations.

PCK — headquartered in Kottayam and run under the Agriculture department — has been reporting losses since 2015-2016. But its decline started much before that. In 2013-2014, it reported a profit of Rs 27.97 crore. The next year, its profit plunged by a third to Rs 8.26 crore.

In 2015-2016, it reported a loss of Rs 14.25 crore. The loss widened to Rs 26.16 crore at the end of March 2020, according to the company’s provisional balance sheet. Its liability is a staggering Rs 255 crore. “There was a time when PCK had a fixed deposit of Rs 175 crore. Today, we are running on an overdraft of `16 crore from Canara Bank,” said Managing Director J Sajeev.

PCK’s only achievement now is it pays salaries to all its employees on time. “The income we get goes into paying the interest on the overdraft,” said Sajeev. When the rubber prices crashed, PCK decided to diversify into other verticals such as dairy farm, quail farm, carbonated cashew fruit drink, passion fruit squash and rambutan cultivation. Except for the rambutan plantation, all the businesses are bleeding the company.

“I don’t think the price crash of rubber led to the crisis in PCK. Individuals with just 100 rubber trees are doing good. It is bad management that is drowning PCK,” said an official in the headquarters, who did not want to be identified.

The dairy run by PCK at Ukkinadka in

Dairy business bleeding Plantation Corporation Rs 1.8L every month

The Oommen Chandy government set up the highly mechanised dairy farm at a cost of Rs 6 crore at Ukkinadka in Kasaragod in February 2016. The farm -- with room for 100 cows -- has everything from a milk packing unit, milk chilling plant, grass cutter, feed mixer, milking machine, and even an electrical grooming brush to give cows a good scratch and massage. The plan was to have 100 cows and get around 1,000 litres of milk every day and sell the milk in PCK’s own brand name.

In reality, the farm has 23 head of cattle, including calves. Of them, only 10 are milking cows, said a worker. The 10 cows give 60-65 litres of milk every day. The milk is sold to Milma’s society in Perla. At Rs 37 per litre, the farm earns around Rs 72,000 monthly. But its monthly expenses come to Rs 2.5 lakh, including Rs 1.5 lakh wage for 12 workers, power bill of around Rs 35,000, and Rs 45,000 for cattle feed.

A private individual is running a 100-cow dairy farm next to the PCK’s hi-tech farm with just five workers. Every month, PCK’s farm is losing around Rs 1.80 lakh. Managing director Sajeev gave out a helpless sigh when asked about the farm. In October 2020, PCK bought a technology developed by the University of Kerala to make a carbonated drink from cashew fruit. It was the company’s another at tempt at diversification.

The factory to produce the drink was set up at Muliyar Estate. It named the product Occiana, after cashewnut scientific name Anacardium occidentale. The plan was to produce 1,000 litres of Occiana every day and sell them in 300ml bottles for Rs 25 each. The project was included in the Rashtriya Krishi Vikas Yojana and Rs 10 crore was sanctioned. Today, the godown at Muliyar is stacked with Occiana bottles with no takers.

The MD said the marketing of the product failed because the commission offered to the distributor was just Rs 2 per bottle. PCK also tried its hand at producing passion fruit squash, cultivating the fruit at its estates in Muliyar, Perla, Adhur and Periya. After the first season, the passion for the product waned and the plants died. It shut its squash outlets in Periya and Muleria. It also invested money in setting up a quail farm with 1,500 chicks. They were housed again in hi-tech (another word of expensive) pens. After the initial excitement, the birds started dying without care, and the quail project was given a quiet burial.

‘PCK needs an overhaul’

PCK’s problems cannot be addressed in a year, said the newly appointed managing director. He bets on rubber for the revival of the corporation’s fortune. “There is nothing wrong in diversifying, but they should be run well,” he said. The major problem faced by the company is high absenteeism among workers, he said. “We take action if workers do not turn up for work for three consecutive days. So they always come on the third day,” he said.

The frequency of tapping has been reduced to once in four days. So if a worker does not turn up on a particular day, his block of trees would be tapped only on the eighth day. Also, the replanting schedule of rubber trees has gone for a toss. “It will come to a point where there will be no income,” said the official. Around 70% of the trees have been replanted.

At least 25% should be replanted in the first year. “But the prerequisite for replanting is proper fencing to protect the saplings from wild animal attacks,” said Sajeev. It has three factories in Pathanamthitta district and at Kalady in Ernakulam district. “The periodical maintenance is long overdue. It can break down anytime,” Sajeev said. He also called for the overhaul of the cashew marketing system. “But PCK is my additional charge,” he said.


Plantation Corporation has been reporting losses since 2015-2016. The major problem faced by it is high absenteeism among workers. The replanting schedule of rubber trees, too, has gone for a toss

  • From having a fixed deposit of K175 crore, PCK is now running on a Rs 16-crore overdraft from Canara Bank
  • It has a liability of Rs 255 crore
  • In seven years in the red, PCK’s loss went up to Rs 26 crore in FY2020
  • The last time it reported profit was in FY2014 — Rs 28 crore
  • It ventured into several new businesses and burned crores of public money
  • It is not maintaining its core business of rubber plantation or its factories

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