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Rubber Journal Asia Latex

Asian rubber industry beats the odds The world needs rubber and the region’s

Asia accounts for 93% of the world’s natural rubber production

largest natural rubber producers, currently encumbered in price volatility and

production deficiencies, are stretching their

limits to deliver and to cater to the demand, says Angelica Buan in this report.


lobal production and consumption of rubber continues to expand in view of the growing demand for tyres in the automobile & transportation industry, as well as non-tyre applications. The Asia-Pacific region, the base for the world’s largest natural rubber (NR) producers and consumers, continues to oil the global rubber market. The region accounts for 93% of the world NR production with Thailand being the largest producer followed by Indonesia, Vietnam and Malaysia. In 2018, Asia Pacific’s NR production reached 12.6 million tonnes, and consumption at 10.2 million tonnes, according to data from the International Rubber Study Group (IRSG) that also estimated global NR supply/ demand surplus/deficit at 107,000 tonnes. Consumption-wise, Asia also accounts for the fastest growth in rubber consumption. According to a Freedonia report, Asia is projected to sweep nearly two-thirds of global demand this year. Indonesia, India, Vietnam, Thailand, and China will post strong gains in rubber consumption owing to rapid advances in manufacturing activity. Demand for rubber in the Americas and the Africa/ Middle East region will also go up, benefiting from growth in these regions’ tyre industries. Meanwhile, the region has also opened its gates to manufacturers based in North America and Europe who are either moving or expanding their production bases to leverage the region’s edge in raw material supply, labour force availability, and lower operations cost.

Thailand churns out 36% of the world’s total rubber production, with Indonesia and Malaysia collectively producing 9.23 million tonnes during 2018, based on data from IRSG. Accounting for about 70% of global NR output, the three Southeast Asian countries also make up the International Tripartite Rubber Council (ITRC), which was established in 2001 to frame and implement policy measures, and the International Rubber Consortium (IRCo). The latter was launched in 2004 to “ensure sustainable NR production, as well as implement mechanisms in achieving remunerative and fair NR prices for the well-being of NR smallholders”. These countries are also among the hardest hit of the price slump and dwindling market demand from import countries like China, which remains the world’s largest rubber market and represents half of Asia’s total market in 2019. The slowdown in demand has come in light of China’s trade rift with the US, another major rubber market for rubber producers in the Asian region. Following decline of NR prices in the global market, rubber tree growers are diversifying to other crops for profits. Reportedly, growers in North Barito, Central Kalimantan, in Indonesia, are banking on corn when NR starts becoming less lucrative. Malaysian growers are also shifting to other crops like cocoa to supplement dwindling income from NR.

Falling rubber prices ridging growth Time and again, volatile rubber prices, and supplydemand imbalances have been challenging for the rubber industry, globally. Based on the Association of Natural Rubber Producing Countries (ANRPC)’s natural rubber trends & statistics, the world production of NR fell 6.5% to 4.9 million tonnes during the first five months of 2019, year-to-year, while consumption was 5.79 million tonnes, up 0.9% from 5.38 million tonnes during the same period a year ago.


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Profile for Plastics & Rubber Asia

PRA-September issue  

PRA-September issue