Rubber farmers in Mindanao beset by low global prices

DAVAO CITY (MindaNews/10 November) – Mindanao has surpassed its target for rubber production global prices have remained at rock bottom since 2012, affecting several small rubber holdings here, an official said.

According to Department of Trade and Industry, the country’s rubber supply has already reached 250,000 metric tons with some 217,000 hectares planted with rubber seedlings this year, higher than the 2016 target of 200,000 hectares.

Sheela Thomas, secretary general of the Association of National Rubber Producing Countries, said “the fluctuations affect the small holdings so badly. It’s thrown down but it will go back up because it’s a commodity.”

Thomas, speaking in a press conference Tuesday, the opening of the two-day 2nd Philippine Rubber Investment and Market Encounter 2015, said 80 to 90 percent of the rubber farmers own less than two hectares each.

She added they were still trying to get assistance from industry experts on how to cope with the volatility of its global pricing.

She said one of the short-term solutions to help out the small players is for the government to consider having a price stabilization scheme to support them and get through this depression stage.

“This will assist them survive the years of adversity,” she said.

Dr. Abdul Aziz Bin S.A Kadir, secretary general of the International Rubber Research and Development Board based in Kuala Lumpur in Malaysia, explained that the pricing of rubber depends on the global economy, which is driven by more powerful nations such as China and the US while European countries are still recovering from the economic meltdown.

He said the economic meltdown in the West has affected the automotive industry where 70 percent of the global rubber producer goes to be processed into tires for cars and aircrafts.

“So, if the demand for cars increases, so does the price of rubber,” he said.

Rhodora Medalla, president of the Philippine Rubber Industry Association, added the highest price for rubber was noted in 2010 to 2011. At the time, the market price was at its highest at P170 to P180 per kilo for the technically specified rubber, or the dried rubber input.

From 2012 onward, she said the price went down to P60 to P65 a kilo.

“It has a negative effect on the manufacturers because they cannot increase the prices that much,” she said.

She added pricing has been affected by greater supply amid a global economic slowdown.

DTI Undersecretary Zenaida C. Maglaya said 99 percent of the country’s supply comes from Mindanao, which is also being eyed as the rubber hub in the Philippines.

“The potential of Mindanao is bright. It’s time that we talk about the opportunities. When we talk about rubber, we also talk about the employment that goes with it,” she added. (Antonio L. Colina IV/MindaNews)