NATURAL rubber prices, which are at their five-year low now, are expected to strengthen next year as demand outpaces supply.
Malaysian Rubber Board director-general Datuk Dr Salmiah Ahmad said the demand for natural rubber next year is expected to be higher than the supply.
“At a time when prices are low, many tappers don’t go out that frequently to tap.
“But in the next few months, the decrease in the supply of natural rubber, the wet weather and
steady global demand are likely to boost rubber prices. This will encourage smallholders to tap again,” Salmiah told Business Times, here, recently.
Due to the low natural rubber prices, the government announced a RM100 million rubber productivity incentive last month to assist the more than 450,000 affected smallholders.
Salmiah, however, declined to provide price forecasts as it is against the board’s policy.
Rubber prices, such as that for SMR20, have risen slightly to RM4.80 a kilogramme from RM4.55 earlier in the year.
Malaysia is the world’s sixth-largest rubber producer, churning out some 800,000 tonnes a year to supply its manufacturers of rubber-based products such as rubber gloves, catheters and condoms.
The industry earned the country RM33 billion in export receipts last year.
Meanwhile, Salmiah said the
attorney-general has approved its revised MRB Regulations (Licensing and Permit) 2014 from its 1997 version to boost efficiency.
The new regulations, effective January, will speed up the rubber collection process, cut down on licensing processes, give the board more powers and help expedite rubber collection from smallholders.
For example, the board currently has to issue six licences covering selling, buying, processing, packaging and nursery of rubber.
“Now, we have cut that down to three licences to make it more efficient as well as enable the board to manage the industry better,” she added.