MALAYSIA is strengthening its rubber sector to withstand global trade headwinds and secure long-term competitiveness, with a focus on industry consolidation, technology adoption and diversified markets.
Plantation and Commodities (KPK) Minister Datuk Seri Johari Abdul Ghani (picture) said the sector, which earned RM33.7 billion in exports in 2024, faces rising challenges, including US tariffs and shifting global demand.
In the same year, the US accounted for approximately RM8.3 billion or 24.6% of Malaysia’s total rubber and rubber product exports, especially in rubber gloves and automotive rubber components, among others.
“The rubber industry is not merely a commodity for Malaysia. It is a strategic pillar of our economy, industrial development and rural communities,” he said during the opening of the International Rubber Industry Convention & Expo (IRICE) 2025 today.
At the same time, he noted the concerns raised by local exporters and industry players, particularly small and medium enterprises (SMEs) that are “feeling the squeeze”.
Johari reassured that KPK, as well as agencies such as the Malaysian Rubber Council (MRC) and the Malaysian Rubber Board (LGM), are actively engaging with stakeholders to explore alternative markets, enhance product value and strengthen compliance with international standards, particularly in the areas of labour practices and sustainability certifications.
He pointed out the struggles of over 295,000 smallholders, grappling with price fluctuations, outdated infrastructure, inconsistent yields and reliance on middlemen, while manufacturers contend with rising costs, unstable raw material supply and growing pressure to meet global standards for quality, labour and sustainability.
To address inefficiencies in the fragmented upstream and midstream segments, he stressed the Rubber Industry Consolidation Initiative, aimed at achieving economies of scale and providing smallholders with access to shared processing centres, modern technology and better infrastructure.
This, he said, would improve quality and traceability to meet global environment, social and governance (ESG) and compliance standards.
The government is also engaging with ASEAN and bilateral partners to secure fair treatment amid tariffs, while encouraging innovation in specialty rubber products and eco-friendly manufacturing to reduce reliance on any single market.
Despite global uncertainty, Johari expressed optimism.
“We must continue to collaborate, innovate and adapt to build a resilient, inclusive, and future-ready rubber industry that uplifts our smallholders, supports our manufacturers, and secures Malaysia’s place as a trusted global supplier of sustainable rubber,” he stated.
Meanwhile, MRC CEO Muhammad Eizaaz Muhammad Redzuan said the industry faces tighter regulations, rising costs, labour shortages and disruptive technologies, making its role more critical than ever.
“Yet, within these challenges lie extraordinary opportunities — to strengthen our brands, expand our markets, and lead in ESG-driven growth,” he said.
Muhammad Eizaaz also reiterated MRC’s commitment to helping the industry not just adapt to change but lead it. He said MRC’s current priorities include deepening its presence in established markets while driving expansion into the Middle East, Latin America and other growth regions.
“The US remains our largest export destination for dry rubber products, with exports valued at RM759.7 million followed by Singapore (RM442.1 million), Australia (RM173.5 million), China (RM154.7 million) and Thailand (RM131.8 million).
“Encouragingly, shipments to Singapore, China, and Thailand recorded growth of 17.3%, 4.3%, and 2.7% respectively, reflecting our ability to diversify and secure gains in non-US markets.
“These outcomes highlight both the challenges we face and the opportunities ahead. They show that with strategic focus, Malaysian rubber products can compete in high-value global segments, demonstrating the resilience of our manufacturers and exporters as well as the value of sustained promotion, innovation, and quality excellence,” he added.
Source: themalaysianreserve