Rubber: Rubber Outlook

Interest in rubber has recently resurfaced due to the increase in price of the commodity. Price of rubber has risen from RM3.50 per kg in 2002 to RM8.00 in 2006. Rubber price has been predicted to remain at current equitable prices for a while due to the following :

  • Global demand for the commodity is set to exceed supply due to the expanding economies of China, India and Eastern Europe.
  • There is a shortage in supply of rubber caused by continuous replanting of rubber to oil palms in the last three decades.
  • Increase in price of petroleum to above US$60 per barrel, making natural rubber more competitive than synthetic rubber.

In view of the above, the Company has considered returning to rubber where terrain is steep and rainfall low where oil palm has not yielded well.
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Contributor : Chan Weng Hoong