Rubber exports expected to rebound in 2021 as double-digit growth in global demand continues

Rubber exports expected to rebound in 2021 as double-digit growth in global demand continues
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KUALA LUMPUR (Aug 11): Given the growth of Malaysia's rubber exports by 150% to RM44.43 billion in the first half of this year (1H21) from RM17.77 billion in the same corresponding period of 2020, the industry is projected to rebound for the full year of 2021.

In a statement today, the Malaysian Rubber Council (MRC) estimated the global demand for rubber gloves in volume terms to maintain a double-digit growth of between 12% and 15% in 2021.

Downstream rubber products exports, which make up 89.7% of the total rubber industry’s exports, increased by 180.2%, driven by strong performance in latex goods, in particular gloves products, it said.

The MRC added latex goods such as rubber gloves, latex threads, and condoms recorded an increase of 200.1%, attributable to the Covid-19 pandemic, with latex goods accounting for 93.9% of the exports of rubber products in 1H21, while dry rubber products constituted the balance 6.1%.

“Gloves products remained the largest export income churner for the rubber industry. Comprising mainly medical gloves, the gloves sub-sector expanded more than three-fold or by 210.2% to RM36.54 billion in 1H21.

“From a contraction in the first half of last year due to the Covid-19 pandemic, the dry rubber products sector rebounded with an outstanding growth of 38.2% to RM2.41 billion in 1H21 from RM1.75 billion in the same period last year. The dry rubber products sector includes tyres, industrial rubber goods, general rubber goods, and footwear,” it said, noting that tyres, the largest export product within dry rubber goods, rose by 43.2% to RM840 million in that period from RM580 million previously.

Meanwhile, total exports of industrial rubber goods comprising products for the automotive, mining and construction sectors improved by 44.2% to RM610 million in 1H21.

“Demand for rubber gloves is projected to remain strong despite the prevalence of the Covid-19 virus coupled with emergence of new variants. The [effectiveness] of vaccination programmes in sustaining low cases remains inconclusive even in advanced nations in Europe,” the council noted.

“The global per capita consumption of rubber gloves is expected to increase to 25 pairs in 2021 driven by higher usage of gloves in Malaysia’s major export markets such as US and Europe as well as large emerging markets particularly in the Asian region. The country’s rubber glove industry will maintain its positive momentum and exports are expected to reach a new high for the full year of 2021,” it added.

Recently, the MRC initiated the Malaysian Rubber Products Virtual Showcase (MaRViS) to further facilitate online business engagements between international buyers and Malaysian rubber product manufacturers.

“This virtual platform will be able to provide a more holistic online experience for international buyers on available Malaysian rubber products through virtual exhibition, live chat and online business matching. Important events such as the e-Global Sourcing Mission (e-GSM) and online seminar are also part of key events that will be held exclusively through the MaRViS platform,” the council said.

By utilising MaRViS, international buyers will be able to obtain information on key rubber products that are produced by Malaysian manufacturers, such as precured treads, engineered rubber products for construction, railway, mining and marine, latex foam and mattresses, rubber medical devices such as medical gloves, condoms and rubber catheters, rubber gloves, rubber automotive components, and green rubber.

The first phase of MaRViS is anticipated to go live in September and the official launch of the online platform is expected to take place in January 2022.

The MRC said it has also set up a commercialization unit entrusted to facilitate commercialisation and investment through continued market penetration, which also includes providing researcher and investor care as well as organising industry dialogues.

Meanwhile, MRC, Malaysian Palm Oil Council (MPOC) and Malaysian Timber Council (MTC) have commenced preparations to set up the Malaysian Agricommodities Regional Office in Jeddah, Saudi Arabia.

The establishment of the office will help to increase the export value of the rubber industry and pave the way for the rubber products industry to penetrate new markets in the Middle East, the council said.

Lam Jian Wyn