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DG’s Message for 2017

The year 2016 was another challenging year for the rubber industry. Natural rubber (NR) prices were relatively more volatile compared to the previous year due weak fundamental factors particularly buying interest amid surging in production. Unfavourable factors such as slow global economic growth, low crude oil prices and poor sentiment in futures markets pressured the NR market. In 2016, the volatility of SMR 20 price was 47% compared with 19% during the same period in 2015. The average price of SMR 20 in 2016 was 568.45 sen/kg compared with 521.90 sen/kg in 2015.

The rubber industry will remain as a strategic sector in the Malaysian economy as the government undertakes several efforts at the national and international level in ensuring the sustainability of the Malaysian rubber industry. At national level, the four entry point projects (EPPs) under the National Key Economic Area (NKEA) continued to be implemented. These include maintaining the production area of one million ha and increasing the average yield. The framework also covers accelerating downstream activities and commercialising new rubber products to value add rubber exports for the country.

As for Malaysian rubber and rubber products, the demand in 2017 is expected to increase but marginally. The industry export earnings is estimated to increase to RM33.5 billion in 2017 from RM31billion in2016.

The natural rubber industry has witnessed phenomenal growth since the 1960s and rubber has been an important sector in the Malaysian economy for many years and is now well-developed; evolving from a mere producer and exporter of natural rubber into a diversified rubber manufacturing industry.

The ultimate goal of MRB for the rubber industry is to produce high value jobs and increase revenues in the rubber sector. We are confident that we will continue to withstand the challenges faced by the industry with the support of Plantation Industries and Commodities Minister YB Datuk Seri MahSiewKeong.

To ensure that the industry remains competitive and moving towards the right direction, MRB has played a significant role to enhance, revitalize and sustain the rubber industry. Among others, the MRB continue to intensify its R&D efforts to give emphasis to the downstream, value-added sector. Selected areas of R&D in the upstream will continue to be emphasized in order to maintain the industry’s competitiveness.

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