Rubber industry needs new investment, research to thwart ‘apocalypse’

I RECENTLY saw a video predicting a rubber “apocalypse”. Though the focus was on natural rubber, synthetic rubber was not spared.

There was concern about a supply shortage looming in the West as the pandemic had disrupted the world’s logistics and supply chain.

Shortages of containers to transport rubber has become common. Some industrial users in the United States have raised the red flag on inventory shortfall.

For many years now, the world has looked to Asean countries for their natural rubber supply.

This is understandable since almost 90 per cent of the world’s natural rubber come from the Asean nations, where Thailand is the leading producer.

Malaysia, once a leading producer, is now at No. 8, behind even Africa’s Ivory Coast. The industry has been poorly supported.

There are many reasons why buyers of natural rubber in the West have raised the red flag on supply. Apart from logistics difficulties, production in producing countries has also suffered setbacks.

The low prices which ran for longer than usual are partly to blame. Rubber smallholders, which comprise almost 90 per cent of producers, have shunned tapping rubber.

And those who have been dependent on immigrant labour face worker shortage because of the Movement Control Order during the pandemic.

Because of the persistently low prices, farmers cut costs on fertilisers and other agronomic inputs. This not only reduced yield, but also created the right conditions for the onset of diseases.

In the past two years, a serious leaf disease, Pestalotiopsis, has been spreading through rubber growing countries.

The disease had a role in bringing down rubber yield. The three issues of price, labour and disease are to blame for the supply dry up.

Buyers are understandably worried because natural rubber is indispensable in many consumer products. Tyre makers are especially jittery because almost 70 per cent of natural rubber end up in tyres.

The bigger the tyre, the more natural rubber it has. Aviation tyres use 100 per cent natural rubber. This also explains why tyre manufacturers are strongly behind the move to ensure the sustainability of natural rubber.

It is not just about the environment, but about the continued supply of the raw material.

Tyre makers are under increasing pressure to meet growing consumer demand for green tyres. Synthetic rubber has its own sustainability problems as they are made from fossil sources, a no go for consumers worried about climate change and global warming.

The fact is, with growing demand for green and renewable tyres, the future of natural rubber looks good. But natural rubber producers have not shown the enthusiasm to capitalise on the opportunity.

There is no doubt that natural rubber countries need to invest more in research. These include research in new products, less labour intensive production and more disease resistant clones.

It is unfortunate that there has been less emphasis on the right research.

Here in Malaysia, researchers at the Malaysian Rubber Board (MRB) are busy with other work demands. One involves resolving the disputes over properties that the board owns.

The MRB has been blessed with a string of high value assets in Kuala Lumpur and the surrounding areas, thanks to the foresight of leaders in the early days of the Rubber Research Institute of Malaysia.

Now that these assets have assumed very high value, there appears to be a scramble to control them from many sources. Now, friends at MRB are unsure whether the assets are a blessing or a curse. The focus on research, which is badly needed during this crucial period, has been sadly neglected.

Natural rubber farmers here have long cried for help. The supply concern in the West has motivated tyre manufacturers to look for alternatives. Already, we have heard reports of a new plant, dandelion, showing some promise.

If this plant becomes a market reality, it would be a repeat of the time when the world discovered synthetic rubber through research driven by a natural rubber shortage during the war years.

Unless remedial steps are taken soon, the natural rubber “apocalypse” will not just be a reality for buyers in the West, but also for poor rubber farmers here!