JakartaPost-July 14
The world is expecting expansion of the rubber industry in the near future, but Indonesia may not get a piece of the pie in the face of lagging downstream of the commodity. The value of global rubber market is expected to reach US$51.21 billion by 2027, from $40.77 billion in 2019, due to rising demand from the automotive, construction and aerospace industries, according to a report from Fortune Business Insights. Other factors include the expanding market for natural rubber, driven by increasing demand for tires and industrial durable goods, such as linings for petroleum and chemical tanks, as well as automotive gaskets and seals. Aziz Pane, chairman of the Indonesian Rubber Council, told The Jakarta Post on Wednesday that Indonesia might not be able to develop its downstream rubber industry in time to seize the enormous opportunity. “Indonesia’s rubber industry has suffered a significant decline,” Azis said, pointing to an increasing number of rubber factories that had closed in the last four years. The closures were due to declining raw materials, he explained, whereas other countries were continuing to intensify plantation expansions and downstream industry development. Azis pointed to the example of Thailand, where almost all upstream output was used as inputs for that country’s rubber industry. In contrast, roughly a mere 15 percent of the total rubber output in Indonesia was absorbed by the domestic industry. Indonesia produced 3.14 million tons of natural rubber last year, according to Statistics Indonesia (BPS), a figure that has remained stagnant for the past decade. According to the International Trade Centre’s online database Trade Map, Indonesia is the world’s second-largest exporter of natural rubber after Thailand, but its output has been fluctuating on a downward trend for at least the last five years. Read more at: https://www.thejakartapost.com/business/2023/07/13/shrinking-domestic-industry-may-dethrone-ri-as-worlds-no-2-rubber-exporter.html.
