‘To succeed globally, Malaysian manufacturers should have extensive experience, significant expertise and in-depth knowledge in the development and production of rubber products,’ said Malaysian Rubber Council CEO Nor Hizwan Ahmad. – LOW BOON TAT/The Star
DESPITE producing about half of the world’s supply of rubber in the 1930s and being the world’s largest natural rubber producer in the 1960s and 1970s, Malaysia only ranks as the fifth- or sixth-biggest producer of natural rubber globally today, according to the Malaysian Investment Development Authority.
But since Covid-19 paused the world in its tracks back in early 2020, awareness for sanitisation and health safety were raised, with the use for rubber gloves elevated.
With stricter global healthcare regulations and increased hygiene awareness, production of rubber and chemical related segments also saw a boost.
Last year alone showed an improved performance in rubber and rubber product sectors, whereby the total export registered a record spike of RM71bil, an increase of 46.3% as compared to RM48.5bil the year before.
Among that, latex goods contributed 91.8% to the total rubber products exports, with rubber gloves remaining the leader of the pack, contributing 88.9% to the total rubber products export at RM54.8bil, an increase of 55.4% over the same period in 2020 at RM35.3bil.
However, as the pandemic subsides, the industry expects the average selling price for rubber to return to pre-pandemic levels by the second half of 2022.
MRC was also selected as the winner of the prestigious Asia Pacific Enterprise Awards (APEA) 2022 under the Professional and Business Services Industry for the Corporate Excellence and Inspirational Brand award categories.
Working hand-in-glove
To manage these expectations, the Malaysian Rubber Council (MRC) plays a vital role in providing the guidance and assistance needed by its stakeholders, particularly the manufacturers, in supporting the transition to a contemporary, high-value-added sector.
MRC chief executive officer Nor Hizwan Ahmad said, “We know the price is going to revert to the pre-pandemic level, therefore we must be ready to manage this.”
With the intent of making the rubber industry ‘sexy’ again, Hizwan explained that the council aims to create and add value to the downstream, midstream and upstream industries by providing guidance and assistance to stakeholders and industry players alike.
Doing so will benefit the entire supply chain of rubber and domestic rubber products to a higher level, such as commercialisation and funding.
Yet opportunities abound as MRC attempts to penetrate untapped markets within India, Africa and Latin America, even the United States and Europe – with better prospects for commercialisation and investment.
Extensive product range
Although Malaysia’s rubber glove industry was the highest earning worldwide in its category, MRC has also been promoting other made-in-Malaysia rubber products that also impact everyday life.
Products like rubber medical devices, automotive parts, household products, engineering rubber products, industrial products, rethreading materials, tyres and processed rubber are still needed for constructing and assembling finished products.
“A car, for example, uses over 200 over parts that are made of rubber alone”, mentioned Hizwan.
The tyre industry was, in fact, enhanced to diversify Malaysia’s export contribution of high-value products and increase the export performance of dry rubber items. It also helps increase consumption of locally produced rubber.
Its exports marked an encouraging 30.7% increase last year reaching RM1.7bil, as compared to 2020 when it achieved RM1.3bil.
Hizwan is also looking into new ventures based on market demands, such as seismic bearings for use in earthquake-prone countries.
He is also promoting retreading materials and rubber automotive components in countries where the automotive industry is growing, such as Vietnam and Brazil.
He added, “As a council, we must be vigilant of the market trend and needs and be ready to embrace change, especially through innovation and adoption of advanced technology.”
To achieve that, MRC will take part in upcoming international trade shows, working visits, business matching, international seminars and conferences, ministerial missions and international branding campaigns.
Upcoming activities
Hizwan concurred that organising and participating in international promotional events is one of the most efficient methods to promote Malaysian rubber products, while raising the international market’s awareness to the high quality of Malaysian rubber products.
One such important event is the Malaysia International Agricommodity Expo Summit on July 26 to 28 at the Malaysia International Trade and Exhibition Centre, Kuala Lumpur.
The event, presented by the Plantation Industries and Commodities Ministry, will host the agri-commodity with industry players, producers, investors and other stakeholders under one roof.
More than 20 countries are expected to take part in the exhibition, which will include conferences, roundtable discussions, business-to-business meetings, industrial site visits and an awards dinner.
The council also plans to launch the new RM10mil Global Fund for Rubber Innovation grant to promote new ideas, innovations and inventions with high commercial viability within the rubber industry.
MRC acts as a catalyst in assisting industry players move up the global value chain. It identifies and evaluates prospective companies, provides them training, coaching and networking through International Development Organisations partnership programmes.
With the tagline #NoOneKnows RubberLikeMalaysiaDoes, MRC endeavours to promote Malaysian rubber products and industry strengths through a global branding campaign – by highlighting the experience and expertise, quality, sustainability, range of products and research and development skills.
This helps position Malaysia as the source for all high quality and sustainable rubber products, across various media targeting local and foreign audiences around the world.
Sustainable measures
By creating a sustainability division in May 2021, MRC was able to ensure a long-term plan and a broad scope covering socio-economic aspects is in place.
The unit will also conduct sustainability programmes for the benefit of the rubber industry and Malaysians in general.
This unit leads and coordinates various environmental, social and corporate governance initiatives related to the rubber industry based on the direction set by the government driven by the six MRC Sustainability Pillars.
Its activities will cover the rubber sectors as a whole, which includes the upstream, intermediate and downstream sectors, relevant government agencies and the society.
MRC’s corporate social responsibility (CSR) initiatives last year involved the community and industry players by addressing the gaps, issues and challenges across the economic, environmental, social and governance considerations.
The council also provides grants to encourage industry players to adopt automation and green technology towards achieving sustainability in the rubber product industry through the Fund for Automation and Green Technology.
For its efforts, MRC won bronze for the Best Community Programme Award in the 13th Annual Global CSR Virtual Summit and Awards 2021. The awards programme is Asia’s most prestigious recognition awards programme for CSR.
MRC was also selected as the winner of the prestigious Asia Pacific Enterprise Awards (APEA) 2022 under the Professional and Business Services Industry for the Corporate Excellence and Inspirational Brand award categories.
Brighter prospects ahead
Malaysian rubber and rubber products exports are collectively expected to grow 5-6% in 2022, with possibly a new high at around RM76bil in value.
Firm rubber prices projected in 2022, together with increasing world demand for natural rubber, will help stimulate domestic rubber production.
Future developments such as the East Coast Latex Corridor, digitalisation via the My Rubber Online platform and the RRIM Niaga smartphone application by the Malaysian Rubber Board (MRB) will add support to the subsector’s growth.
On MRC’s part, Hizwan said he is constantly finding ways to help rubber industry players to reach the international market.
To help small and medium enterprises in the dry rubber sector get a foothold in the international market, MRC identifies and nurtures them in a pathfinder programme, which clarifies their uncertainties regarding exporting and to overcome some common challenges.
And through the launch of the virtual platform MaRViS, Malaysian rubber product manufacturers can connect with each other to enhance trading experiences and access buyers from around the world.
“To succeed globally, Malaysian manufacturers should have extensive experience, significant expertise and in-depth knowledge in the development and production of rubber products,” said Hizwan.
“Through constant research, Malaysia is able to ensure continuous product improvement and development, producing innovations that have elevated made-in-Malaysia rubber products as the best in quality and comply with stringent international standards.”
