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World rubber production and consumption in historical perspective.

The world production of natural rubber

Production of natural rubber (000 tons)

Figure 1: Production of natural rubber according to the major producing countri


Source: FAOSTAT, 2016
Figure 1 shows the evolution of overall natural rubber production after 1960.
In 1961, the major producing countries are Malaysia, Indonesia, Thailand, Sri Lanka,
India, and China. Malaysia accounts for approximately 37.2 % of the world NR
production or about 789000 tons. After Malaysia, the other most important
producing countries are Indonesia (32.7%), Thailand (8.8%), and Sri Lanka (4.6%) as
shown in Figure 6-11. Rubber production has increased from 2.040 million tons in
1960 to 3.1 million tons in 1973. Malaysia and Indonesia have continued to lead
production. Before 1975, Malaysia production grew over 4.0 % per annum and
increased share of NR production from 39.35% in 1960 to 48.78% in 1975. These
have been due to government replanting schemes and wind spread of high-yield
clone.
In this time, the share of world production from Indonesia declined from 31.0
% in 1960 to 24 % in 1975 as Figure 6-11 shows. There were few replanting scheme.
However, total production increased at average 1.9 % per annum.
NR production from Thailand has increased both in terms of output and share
to world production. The share of NR production was roughly 8.0 % in 1960 to 10.0
% in 1975, reflecting an annual rate of output growth about 5.0 %. Like Malaysia, a
replanting scheme has been implemented since 1960.
During 1974-1987, the production grew very slowly about 1.9 % per annum
but the growth of NR consumption was about 2.0 per annum.
In 1988, the world production of NR rose by about 4.8 % to over 5.0 million
tons. Production rose in three major producers: Malaysia, Indonesia and Thailand by
5.1, 2.6 and 4.5 % respectively. The large gains reflected the coming into bearing
new areas planted to higher yield clones. After that, world production of NR grew
from 5.020 million tons in 1988 to 6.07 million tons in 1995 by an average of 2.6 %
per annum from 1988-1995. The world NR production slowed down in the early
1990s because of the decline in production in Malaysia and Sri Lanka.
Malaysia production has declined since the late 1980s which were results of
lower prices, production constraint and labor problems leading farmers to shift other
crops. Malaysia has had the most lack performance in rubber production affecting
lost share in NR production. The average growth rate was -4.0 % per annum during
1989-1995.
The decline in Sri Lanka resulted from civil disturbances, leaf diseases and
erratic weather. Other producing countries increased their output substantially and
Thailand becomes the largest producer of NR in 1991. Thailand has been ongoing
replanting schemes to more than double their production. This trend continued into
the 1990s. Indonesia remained the second largest producers which increased at
about 2.0 % per annum during 1988-1995.
The world production of NR has been stagnant after 1990 due to new planting
and replanting scheme in traditional areas associated with the impact of low price.
Indeed, during 1996-2000, the NR production has some stagnated, largely as a
result of low rubber prices and increasing production cost. Accordingly, average
price continued to trend down in this period.
In the 2000s, the major NR producing countries are Thailand, Malaysia and
Indonesia, which accounts about 73.2 % of the world NR production in 2011.
Thailand was the world largest producers. NR production from Thailand has
increased at the annual growth 4.7 % per annum from 2.319 million tons in 2001 to
3.527 million tons in 2011 as shown in Table 6-22. The relative share in the world
production increased to 33.9 % in 2011.
Indonesia was the second largest NR producer. NR production has sharply
increased from 1.607 million tons in 2001 to 2.066 million tons in 2004 and rose to
3.093 million tons in 2011. Production still continued a trend upward growth at
annual rate of production growth about 7.1 %. Indonesias share in the world
production increased from 21.9 % in 2001 to 29.7 % in 2011.
In contrast, unlike Thailand and Indonesia, NR production from Malaysia has
shown a trend decline and has varies during the 2000s. NR production has sharply
increased from 0.882 million tons in 2001 to 1.283 million tons in 2006 and fell
steadily to the lowest of 0.857 million tons in 2009, and thereafter it has been
recovered again after 2010. Then, Malaysia has steadily lost share of NR production
to other producing countries, which cause decline of the relative share of NR
production from 12.0 % in 2001 to 9.6 % in 2011 as Figure 6-16 shows. These three
producers accounted for about 73.0 % in the world production of natural rubber.
Elsewhere in Asia, the NR production has also increased especially from China
and India, which mostly used for domestic consumption. Sri Lanka recovered in
production to compare with previous period that production has increased even the
proportion of the world production was low.
The bulk of NR production in producing counties is exported over 90.0 % for
their production during the 1990s. Proportion of export steadily decreased in the
period 2000s, reflecting growth of domestic consumption. Malaysia has been
impressed for increasing proportion of domestic consumption above 40.0 % of total
production.
The percentage of export in the total production from Thailand and Indonesia
has slightly decreased, which have made effort to increase domestic consumption.
In Thailand, the export has increased from 2.042 million tons in 2001 to 2.952
million tons in 2011 with the annual average 4.46 % per annum. The proportion of
export in the total production was 86.1 % in 2011 compare with about 89.1 % in
2001, reflected it steadily increased in the proportion of domestic consumption even
this export accounted for a larger proportion than domestic consumption (Table 6-
23). Domestic consumption totaled 490,400 tons in 2011 compared with 253,100
tons in 2001. The growth of domestic consumption increased at annual average of
9.4 % as Table 6-24.
Like Thailand, the proportion of export in Indonesia has been a large share in
the total production. The export increased from 1.496 million tons in 2001 to about
2.568 million tons in 2011. The growth of export grew at annual average of 7.16 %.
The proportion of export in total production decreased from 91.2 % in 2001 to 86.4
% in 2011 in parallel the domestic consumption rapidly grew at annual average of
23.15 per annum. Domestic consumption totaled 476,000 tons in 2011 compare
with 142,000 tons in 2011. This has comparable volume of domestic consumption in
the same level with Thailand and Malaysia as Table 6-24. The main export
destination is USA which still account about haft of total export. Some proportion is
reexported from Singapore (ANRPC, 2012).

Figure 2: Share of NR in the world natural rubber production according to the major p
Source: FAOSTAT, 2016
The world rubber consumption
Rubber consumption ('000 tons)
5000

4500

4000

3500

3000

2500

2000

1500

1000

500

U.S.A. Japan China India


Malaysia Korea France Germany

Demand characteristics of main rubber consuming countries


Demand for NR mainly comes from the industrialized countries, which have
the great portion to consume by USA and Western Europe. NR consumption from
USA has steadily increased from 487,000 tons per year in 1961 to 651,000 tons in
1972 but the relative share of USA in the world NR consumption has steadily
declined from 23.4 % to 20.1 % in the same period.
Growth of vehicle industry is key factor to drive demand for NR as well as the
trend growing economy. US consumption still increased from 712,000 in 1973 to
peak of 802,000 tons in 1977 and fell to the lowest of 585,000 tons in 1980, which
adversely declined share of the USA in the world consumption to 15.5 %. NR
consumption recovered in the early 1981. The annual average of consumption was
about 628,300 tons in 1981/83 and grew to 844300 tons in 1988/90. The rate of
growth was about 2.7 % per annum while the relative share of the world
consumption has slightly increased to 16.8 %.
In 1991, NR consumption fell to the lowest of 755,400 tons and rose to more
than 1.19 million tons in 2000. The growth rate of consumption was about 5.8 % per
annum. The relative share of USA has decreased to 16.2 % in 2000. Thus, the share
of USA has to continue a trend downward relative share of the world consumption.
In comparison, NR consumption from Western Europe has steadily increased
during 1960-1973. During the period of oil crisis, the average annual consumption
therefore dropped except France and Germany continued a trend growth of
consumption, therefore increased by about 0.10 % per annum during 1978-1988. An
annual average of NR consumption consumed a little growth by about 0.8 % during
1988-2000. The Western Europe counties consumed about 20.11 % of the world
consumption leading by France and Germany.
In 2000, Western Europe and USA consumed about 39.13 % of total world
consumption that has strongly declined to compare with 51.5 % of the world
consumption in 1978 (IRSG, 2002).
Japan is the second consuming countries. NR consumption has increased at
annual average of 232,000 tons during 1960-1972, which has been at an average
growth of 6.6 % per annum. The period of oil crisis also has been the growth of NR
consumption at annual average of 340,800 tons during 1973-1980 but has slow-
down of consumption by about 3.4 % to compare with previous period. Throughout
the 1960s-1970s, economic boom in Japan based on heavily manufacture such
important of automobile that stipulated to high demand for NR. Japan becomes the
world third largest economy behind USA and the former USSR in the 1980s. The
annual consumption of NR still grew at annual average of 5.5 %. The annual
average of consumption increased from 459,700 tons in 1981/83 to 652,000 tons in
1988/90. The growth of NR consumption in this period regarded to high economic
growth in Japan. In 1992, NR consumption has gradually declined from 689,500 tons
in 1991 to the lowest of 385,400 tons in 1992, reflected to enter to economic
recessionary period in Japan. The recession economic in Japan continued to depress
a trend slowdown consumption of NR throughout the 1990s. The annual average of
consumption has steadily increased from 654,000 tons in 1993/95 to 731,000 tons
in 1998/2000. The annual average of growth was by about 0.90 %. Japans share in
the world consumption has increased from about average 8.7 % in the 1960s to
annual average of share 12.2 % in the 1980s and fell to 11.0 % in the 1990s. In
2000, Japan consumes 751,800 tons or a 10.2 % share. Japan is an important
importer of NR from Thailand since the 1970s and later surpassed by China in the
2000s (FAO, 2000b, 2003).
For China, demand for NR has steadily increased at annual average of
177,000 tons in the 1960s to 297,500 tons during 1973-1980, which was low
relative share in the world consumption about 8.10 %. Since 1978, the reform
economic was made to industrialization and will adversely increase NR
consumption. The NR consumption grew from 315000 tons in 1981/83 to 645,000
tons in 1988/90. The growth of consumption has doubled or rate of growth by about
11.2 % regarded to the reform economic in the mid 1980s. Open economy and
industrialization continued to a trend growing upward of NR consumption
throughout the 1990s to 2000s. The annual average of consumption grew from
633,000 tons in 1991/93 to 867,000 tons in 1997/99 and rose substantially to 1.50
million tons. The relative share in the world consumption has increased to 10.5 %
during the 1990s and reached 15 % of the world consumption in 2000. China was
the second largest NR consumption since 1992. Automotive industry and
industrialization have been rapidly expansion since the early 1990s that stipulate to
grow fastest NR consumption.
China will be the largest consuming countries with the highest growth rate in
next decade (IRSG, 2002; FAO, 2000b, 2003). Developed countries are the largest
consuming countries in the world market. Demand for NR in developed countries
increased steadily by about 1.2 % in 1978-1988 and continued slow-down to 1.0 %
in 1988 to 1998/2000.

The result was the relative share from the developed countries in total world
demand declined from 66.6 in 1978 to 55.9 in 1988 and further fell to 50.5 in
1998/2000 as Table 6-17. The large reduction of share was observed in Europe and
North America in 1988 and further continued in 1998/2000. They remained
important consuming countries at least before 2000 (FAO, 1990).
On other hand, the developing countries consumed about 1.257 million tons
in 1978, rose to 2.259 million tons in 1988 and continued a trend fastest growth of
demand by about 3.262 million tons in 1998-2000 with regarding to industrialization
and the grow of economic. The relative share has sharply increased from 33.1 % in
1978 to 44.1 % in 1988 and still grew to 47.6 % in 1989/2000. The proportion of NR
consumption from the developing countries would share to above 50.0 % in the
2000s. There has been the structural change in the market structure (FAO, 2000b,
2003).
The world rubber consumption enter period of boom during the early 2000s
corresponds to the strong economic growth in developing countries essentially
driving by China economics.
Price rose once more than the out of break of Korean War but it have been
high instability and a trend slow-down in the end of period. The world consumption
of rubber has increased from the lowest of 17.586 million tons in 2001 to over
20.593 million tons in 2004 and rose to peak of 24.864 million tons in 2011 as Table
6-18 shows.
The rate of growth was by about 4.1 % per annum. The growing consumption
reflected the movement of economic development and its growth, which was grew
in specific regional trends. The production of the world rubber has been lower than
consumption since 2005. By the supply side, the growth rate of production grew by
about 3.7 % per annum, which resulted to have a trend deficit of production along
the period. The world rubber production has increased from 17.815 million tons in
2001 to over 20.721 million tons in 2004 and rose to 24.481 million tons in 2011. On
the basis of the world rubber consumption, share of NR consumption has steadily
increased from 41.7 % in the world rubber consumption to over 43.0 % in 2005 and
then thereafter have been stabilized in market share. It reflected the growth of
demand for NR at faster rate during the 2000s.
On other hand, share of SR consumption declined from 58.3 % in 2001 to
lower 55.6 % in 2008 and steadily increased over 56.7 % during 2009-2011. The
rated of SR share in the world consumption has decreased by about -2.8 % per
annum. The major reason for the decline expansion of SR consumption was the high
peak oil price during 2003-2008. The oil price rose above 30 U.S dollar per barrel
during 2003 and reached to the average of 60 dollar per barrel in 2005 and peaked
at 147.30 U.S dollar per barrel in 2008. The period of peak oil price has affected to
increase production cost in SR production which stipulated to decline of SRs share
in the world rubber consumption. This trend continued into the early 2010s
corresponding to uncertainty of politics and the world recession in developed
countries (FAO, 2003; RRIT, 2012).

Consumption of natural rubber by the major consuming countries during


2000-2011
Unit: 000 tons

U.S.A Kore Franc Germa


Year . Japan China Spain U.K. a e ny
1988 791.8 656.6 420.7 116.9 120.5 235.4 176.7 203.3
1989 880.9 665.4 409.6 121.7 127.5 231.4 182.4 221.3
1990 820.1 663 339.5 119.2 136.2 253.7 177.7 208.7
1991 776.2 690.6 312.3 101.2 117.5 262.5 170.2 210.6
1992 913.4 675.7 335 108.7 124.4 274.2 173.9 212.8
1993 987.6 633.6 325 103.3 119.7 274.9 168.5 174.9
1994 975.6 644.3 405 117.1 134 300.7 179.9 187.1
1,026.
1995 10 696.2 297.2 129.7 120 288.5 175.8 211.7
1,014.
1996 00 724.1 489.5 129.9 111.3 299.4 182.1 193.3
1997 1,044. 730.4 361.7 148 120.3 299.3 192.2 212.4
20
1,176.
1998 80 678 411.1 158.7 139 282.1 223 246.6
1,116.
1999 30 755.4 401.8 161.4 126.9 331.6 240 225.8
1,191.
2000 60 801.5 820.4 171.4 122.6 303.8 270 250.1
2001 972.1 713.3 943.3 183.7 98 330.3 282 245.3
1,126.
2002 40 771.8 914.7 185.6 93.6 325.8 253.5 265.8
1,119. 1,149.
2003 80 791.8 60 191.2 98.7 342.2 236.3 283
1,156. 1,205.
2004 20 800.7 90 194.1 99.5 352.3 244.1 270.2
1,169. 1,454.
2005 70 848.6 20 192.6 96.4 370.5 245.5 282.2
1,011. 1,911.
2006 60 885.9 80 194.8 80 364.7 236.1 295.5
1,028. 1,938.
2007 50 849.9 50 203.2 103 378 243 330.3
1,052. 1,997.
2008 30 849.9 20 185.2 90.1 359.1 222.5 281.5
2,499.
2009 704.8 596.8 20 130.1 52.9 332.1 137.4 239.4
2,888.
2010 931.3 747.2 30 178.2 70.9 387.7 176.2 391.9
1,048. 3,048.
2011 60 785.3 90 172.1 83.9 402.1 197 411.5
3,425.
2012 968.9 700.1 90 145.4 60 397.3 167.9 355.8
3,975.
2013 927.3 721.7 10 146.7 58.3 396.3 163.1 362
4,096.
2014 946 689.4 10 171.1 62.2 403.3 157.1 386.8
4,200.
2015 952 681.9 10 174.1 55.5 388.4 164.4 364.6
Year China U.S.A. EU-28 India Japan Korea

2000 1,080 1,195 1,260 638 752 332


2001 1,330 974 1,260 631 729 332
2002 1,395 1,111 1,182 680 749 326
2003 1,525 1,079 1,309 717 784 333
2004 2,000 1,144 1,291 745 815 352
2005 2,275 1,159 1,347 789 857 370
2006 2,769 1,003 1,338 815 874 364
2007 2,843 1,018 1,394 851 887 377
2008 2,947 1,041 1,257 881 878 358
2009 3,306 687 860 905 636 330
2010 3,655 926 1,136 944 749 384
2011 3,601 1,029 1,242 957 772 402
2012 3,857 950 1,076 988 719 396
2013 4,210 913 1,060 962 712 396
2014 4,760 932 1,146 1,012 709 402
2015 4,840 951 1,205 1,012 736 392

Table 6-19 shows the levels of consumption in major consuming countries. There
has been structural change in rubber market from the developed countries into the
developing countries. China is the world largest consuming countries since 2001.
The consumption was about 1.330 million tons in 2001 and rose to over 2.00 million
tons in 2004 and peaked at 3.646 million tons in 2010, reflecting the economic
growth and high demand for motor vehicles and rubber goods. NR consumption has
doubled since 2003. About 16 % per annum was the highest growth of NR
consumption. Share of NR consumption in the world NR consumption has increased
gradually during this period from 18.1 % in 2001 to peak of 36.3 % in 2009 and
slightly declined to 32.0 % in 2011 as
Figure 6-14 shows. This indicates that the boom of NR in this period driven by the
great NR consumption from China. USA is the second largest consumer. NR
consumption was about 0.974 million tons in 2001 and rose to the annual average
of 1.07 million tons during 2002-2008 and fell sharply to 0.687 million tons in 2009
corresponding to economic crisis to mark by the great recession economics and
subprime mortgage crisis in the end of 2008. The consumption began to recover by
about 1.029 million tons in 2001 reflected on stable situation in economic recovery
and possibility against with Fiscal cliff, even through this problem will be forced a
trend slow-down in growth of consumption. During the 2000s, NR consumption from
USA has declined and their share in the world NR consumption has decreased
substantially from 13.3 % to 9.6 % in 2011. This declining trend appears largely
because of the increase demand for NR from China.

Figure 6-14 Relative share of NR in the world natural rubber consumption


according to the major consuming countries during 2000-2011
Chart Title
6,000

5,000

4,000

3,000

2,000

1,000

0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

China U.S.A. EU-28 India Japan Korea

In Japan, the pattern of NR consumption has similarly to USA. The NR consumption


also has increased during 2001 2008 from 0.729 million tons to 0.877 million tons
in 2008 and fell to 0.635 million ton in 2009. The consumption has recovered during
2010-2011 from 750.4 to 765.1 million tons. Japans share in the world NR
consumption steadily declined from 9.9 % in 2001 to 7.1 % in 2011. The
consumption from Japan has stable to compare with the 1990s. The pattern of
consumption for France and Germany has varies during 2002-2008. The annual
average consumption was about 0.218 million tons for France and 0.257 million tons
for Germany, which has increased to compare with the 1990s reflected the growth
of Europe economy and expansion of economic activities in Euro zone. The level of
consumption has increase marginally in Germany. After 2008, France and Germany
have been a trend slow-down in growth of consumption in response to the great
recession in USA and the recession economics in Euro zone. In 2011, Europe has
presented a declining proportion of world NR consumption corresponding to
financial crisis and the ongoing sovereign debt crisis affecting the decreasing
industrial output (FAO, 2003; RRIT, 2013).
World production, consumption and share of SR and NR during 2000-2011
Unit: 000 tons