Is Natural Rubber under mortal threat? Is there a possibility that factors like climate change, diseases etc. will bring the plantation industry to its knees?

It is a fact that the traditional rubber growing regions in almost all rubber producing countries in Asia are increasingly constrained by adverse effects of Climate Change. The yield from Hevea in traditional regions is impacted by extreme weather, recurrent cyclones, depression rains and flash floods. The last couple of years have seen interruption to tapping due to unforeseen rains and floods. Another major constraining factor is the recurrent outbreak of new diseases. For example, the outbreak of a new fungal leaf disease (Pestalotiopsis leaf fall disease) reported in Indonesia in 2018 has now spread into around 387,000 ha of mature rubber trees in the country. An estimated 141,000 ha in Thailand, 16,000 ha in Malaysia and 4,000 ha in Sri Lanka are reportedly affected by new fungal leaf diseases.

The low rubber prices that continued over several years resulted in poor maintenance of rubber holdings in almost all producing countries. As resource-starved farmers could not apply fertilizers or adopt proper crop protection measures over several years, rubber trees became weak and lost their resistance to diseases and extreme weather. It is striking to note that the root cause of the decline in yield is the unattractive prices and the resultant poor maintenance of holdings. A major trend reversal of prices can bring glaring positive changes in the natural rubber production sector. The potential national average yield (i.e., the annual production from a unit hectare of tapped trees) is 20 to 30% higher than what is realized now. For example, the average yield in India is currently 1,400 kg per hectare.  But a favorable price can increase the average yield to the range of 1,750-1,800 kg. The country had realized the average yield of 1,823 kg in 2012 when the prices ruled high.  Moreover, a large extent of mature trees which are currently left untapped in the country will come back to production once farmers find the prices attractive.  The country has around 200,000 hectares of mature trees which are left untapped.

More specifically, it is the uneconomic return from the venture that hinders the natural rubber production sector. There is no mortal threat to the supply base as far as prices stay remunerative and the net profit from the venture is attractive. No industry can sustain for a long if it is economically unviable and natural rubber is no exception.

 

Can a COVID19 like pandemic impact NR industry long term? Do plantations have an effective healthcare plan to ensure labourers’ health and safety?

NR sector globally has almost fully recovered from the impact of the Covide-19. This is particularly true with reference to the global production, consumption, trade, and prices of natural rubber. The prices in key physical markets had crossed over the pre-covid level even by October 2020 and firmed up further since February 2021. 

It is true that the production and processing sectors in Thailand and Malaysia are partly hindered as cross-border travel restrictions prevent migrant workers from neighboring countries to return to works. This issue, to a large extent, is resolved by making use of local workers by providing them necessary skills training. Coming to the downstream manufacturing sector, large number of debt-burden units in the MSME sector are reportedly struggling hard to bring their businesses back to normal.  On the other side, large-scale manufacturing units, particularly those in auto-tyre manufacturing, have made V-shaped recovery driven by the pent-up momentum generated on lifting of the lockdowns. For healthcare rubber products such as rubber gloves, the epidemic has been a major boon. Taking the global rubber industry as a whole, the industry has already come out from the impact of the pandemic.

Workers engaged in large plantations are provided with social security and healthcare facilities as per the regulatory provisions being followed by the governments in the respective countries.

What are the chances of NR getting totally replaced by alternative rubbers? Will this happen? If so, how soon?

NR getting totally replaced by any alternative material is an impossible event in any case. The relative share of NR in the total quantity of new rubber (i.e., natural rubber and synthetic rubber) globally consumed was less than 30% during early 1970s. From that low level, the relative share of NR has gone up to nearly 50% as of now (47.2% in 2020). Synthetic rubber and natural rubber are not competing each other because technical considerations limit the scope of substitution between the two.

Lack of sufficient economic benefits is considered to be a reason for planters looking for alternate crops that can bring faster financial returns. How real is this? How much of rubber plantations have been replaced by other crops?

A total extent of nearly 0.6 million hectares of rubber trees was estimated to have cut down during 2015-2020 period in Thailand, Viet Nam, China, Malaysia, and India for cultivation of other crops or for conversion of land for non-farm uses. The details are given below:

 

 

In the case of Thailand, farmers are offered attractive cash incentive (More than US$3500 per hectare) by the government for removing aged rubber trees and planting other crops. It means, the shift from rubber in Thailand is largely policy driven. The case of Thailand is an exception. Generally speaking, the crop shift from rubber over the past few years is caused by the unattractive net profit from the venture.

 

Is plantation industry too slow to modernise itself, technologically as well as in terms of attracting skilled labor?

It is a fact that technological progress is severely constrained in the smallholder-dominated rubber production sector. The unattractive prices that prevailed over the period since 2015 made the farmers deprived of resources. Although high-yielding clones are available, farmers are generally postponing the replating of aged low-yielding trees due to their inability to meet the huge replanting cost. Another factor that prevents smallholders from replanting is the uncertainty of the farmers over the long-term prospects of rubber cultivation. Unattractive prices have also discouraged farmers from adopting good agricultural practices. Poor return from the venture has compelled farmers to discontinue the application of fertilizers, pest and disease management measures, and proper maintenance of holdings. Larger section of farmers has discontinued the use of stimulants and rain-guarded tapping. However, technological progress continued in large plantations owned by corporates, enterprises, and the public sector.

 

NR supply has always been unstable due to various reasons. Is this prompting manufacturers to look for other options?

There is no serios supply constraint or supply uncertainty as of now except the seasonal shortage.  Moreover, all the producing countries have huge potential to increase their supply if the prices become attractive.  This point was elaborated earlier.

 

Is there a campaign being run by alternative rubber sector to put pressure on NR industry?

As stated earlier, NR does not face any threat from alternatives basically due to the reason that the only substitute for natural rubber is natural rubber. In the total global consumption of new rubber (i.e., natural rubber plus synthetic rubber), the relative share of NR is currently around 50% (47.2% in 2020) as against less than 30% in early 1970s. There is no reason to anticipate a fall in the relative share of NR in the next three decades at least.

Are environmental sustainability factors detrimental to NR cultivation?

Environmental considerations can only help NR to gain preference over synthetic rubber, polyurethane, and other materials in various applications because natural rubber is recognised as “an environment-friendly industrial raw material and renewable resource”. The following points establish such a view:

1. Rubber plantations purify atmosphere by absorbing CO₂ and releasing O₂. Based on scientific research undertaken by rubber research institutes in five countries, it is empirically proven that a hectare of rubber plantation annually sequesters as much as 30 tonnes of CO₂ from atmosphere which is near to that of the Amazonian base.
2. Rubber plantations are a good source of timber and bulk of this goes into furniture industry thereby protecting large extent of forests from being logged every year. Secondary branches of the rubber trees go into the fiber board industry and small twigs are used by the rural people as a source of firewood, both indirectly saving forests.
3. Rubber plantations contribute to sustainable soil productivity. Soil productivity has not deteriorated in any of the traditional rubber growing countries which have the history of growing rubber for more than 100 years and already completed 3-4 rubber plantation cycles. 
4. One of the key factors which had adversely affected food crops production in the last couple of years was climate change.  Rubber plantations offer solution to this as it helps balancing carbon level in atmosphere.  Rubber is no longer a mono crop.  Several food crops are grown along with rubber plants in all NR producing countries. The concept of raising rubber plantations as agro-forestry is being increasingly promoted across countries.  It is common among rubber farmers to maintain a portion of their land for other crops.  Moreover, rubber holdings provide sources of ancillary income through activities such as horticulture, fishery, honeybee, goat farming, etc. 
5. In all major natural rubber growing countries, rubber has been identified as a major tool of poverty alleviation and thus helping to achieve the Millennium Development Goals (MDGs).

 

Are there any concerted efforts being taken up by organisations like ANRPC, IRSG or governments that subsidise NR cultivation?

Developmental activities such as promotion of new-planting and replanting in each country are undertaken by the respective governments only. Among the member governments of ANRPC, Thailand, Malaysia, India, and Sri Lanka provide financial incentives to farmers to promote the cultivation of rubber. The governments usually mobilize the funds needed for the purpose from the same sector by levying a cess on the quantity of NR exported from the country or consumed within the country. The financial assistance cannot be termed as a ‘subsidy’ because the funds needed for the purposes are mobilized from the same sector.

 

Is it possible to have a globally uniform price structure for NR that can ensure interrupted supply?

In a market driven global economy, commodity prices are largely determined by the forces of supply and demand. This is particularly true in the case of NR which is a strategic industrial raw material coming from more than 10 million smallholder farmers world over. It is not practical to regulate NR prices globally as it is a real challenge to bring together all major producing countries and consuming countries for such a common agenda on terms acceptable to all. (TT)

Zeon Corporation has been included in three major ESG investment indices, marking its debut selection for the FTSE4Good Index, the FTSE JPX Blossom Japan Index and the FTSE JPX Blossom Japan Sector Relative Index. These benchmarks are administered by FTSE Russell and serve as key performance measures for enterprises with robust environmental, social and governance practices.

The FTSE JPX Blossom Japan and its Sector Relative counterpart are specifically utilised as reference points for the Government Pension Investment Fund of Japan, while the FTSE4Good Series holds international recognition for tracking leading global firms. FTSE Russell’s evaluation framework examines a broad spectrum of criteria, spanning climate action, ecological footprint reduction, supply chain integrity, human rights, workplace safety, governance structures and anti-bribery protocols.

Operating under a founding principle dedicated to environmental preservation and human welfare, Zeon perceives this acknowledgment as validation of its ongoing sustainability efforts. The company remains steadfast in advancing social contributions through its commercial operations and intends to persistently strengthen its long-term enterprise value.

Michelin and Axens have entered exclusive negotiations on a strategic partnership to accelerate the industrial deployment of 5-Hydroxymethylfurfural (5-HMF), a bio-based chemical developed with IFP Energies Nouvelles (IFPEN) for use in sustainable industrial applications.

Under the proposed agreement, Axens would contribute its licensing and engineering expertise to support the global rollout of the technology, while Michelin, through its ResiCare brand, would continue to develop production capacity. The companies said the partnership is intended to help replace selected fossil-derived chemicals with renewable alternatives sourced from plant materials.

A first production unit, located at Péage-de-Roussillon in France, will be operated by Michelin ResiCare. The facility will have an annual production capacity of about 3,000 tonnes and is expected to begin operations in early 2027.

The technology is the result of a joint research and development programme between Michelin ResiCare and IFP Energies Nouvelles, supported by France's ADEME and the European Union's Circular Bio-based Europe Joint Undertaking (CBE JU).

5-HMF is a bio-based platform molecule used in the manufacture of resins, adhesives and polymers. It can also be used to produce polyethylene furanoate (PEF), a bio-based plastic regarded as an alternative to polyethylene terephthalate (PET), with potential applications in food packaging, bottles and textile fibres. The molecule can also be used in solvents, specialty chemicals and intermediates, while replacing selected petroleum-derived compounds, including formaldehyde, in existing industrial processes.

Jacinthe Frecon, vice-president of Process and Equipment Innovation at Axens, said: “This project fully illustrates Axens’ ambition to turn breakthrough innovations into concrete industrial solutions on a global scale. By combining a technology born from leading research collaborations with IFP Energies Nouvelles with our licensing and engineering know-how, we have the opportunity to accelerate the deployment of key bio-based solutions for the transition to more sustainable chemistry.”

Laurent Lemonnier, chief executive of Michelin ResiCare, added: “We are convinced that 5-HMF is set to become a reference platform molecule for sustainable chemistry. Our planned partnership with Axens is a decisive lever to accelerate its global deployment and meet growing demand for high-performing bio-based solutions. This collaboration confirms the strong development potential of 5-HMF across a wide range of applications, as well as the performance of our technology developed with IFPEN. It fully reflects Michelin ResiCare’s commitment to developing innovative solutions that contribute to a safer, more sustainable world.”

Michelin said its work on alternatives to formaldehyde and resorcinol in adhesive resin formulations began in 2008. Since 2021, the company has collaborated with IFP Energies Nouvelles to develop a production process for 5-HMF based on fructose. The molecule is now used across all new Michelin ResiCare formulations for composites, plywood, abrasives and moulded compounds.

As Extended Producer Responsibility (EPR) frameworks expand globally, the tyre industry is undergoing a structural transformation. Collection systems are improving, traceability is increasing and investments in recycling technologies are accelerating. However, one critical tension remains insufficiently addressed: the speed of industry evolution is outpacing the agility of public policy. And within that gap, one key question emerges: where does retreading fit in this new circular economy architecture?

A STRUCTURAL PARADOX

Retreading represents one of the most efficient forms of resource optimisation in the tyre lifecycle. It extends product life, reduces raw material consumption and lowers emissions. Yet, in many regulatory frameworks, it is still treated ambiguously – often grouped with recycling rather than recognised as prevention or preparation for reuse. This distinction is not semantic. It is strategic. Because when policy fails to differentiate, markets fail to prioritise.

A FAST-MOVING INDUSTRY, A SLOW-MOVING FRAMEWORK

The tyre market is evolving in real time:

1. Increasing penetration of low-cost imports.
2. Growing variability in product quality.
3. Accelerated turnover cycles.

Retreading, in this context, becomes more than a circular solution. It becomes a filter of industrial quality. Not all tyres are equally retreadable. And that difference defines their real contribution to circularity. Yet most EPR systems continue to operate with uniform economic signals, failing to distinguish between products that enable multiple lifecycles and those that exit the system after a single use.

SIGNALS FROM EUROPE

Recent developments in countries like Portugal – where eco-fees applied to retreaded tyres approach those of low-cost, non-differentiated new tyres – highlight a concerning trend. Similarly, in Spain, industry representatives continue to advocate for a clearer institutional recognition of retreading within EPR systems. These cases illustrate a broader issue: circular policies can unintentionally undermine higher-value circular strategies.

THE MISSING LINK: PERFORMANCE-BASED POLICY

What is missing is not regulation. It is regulatory precision. EPR systems have successfully organised waste flows. But they have not yet evolved to reward performance within the lifecycle. This is where eco-modulation becomes critical.

ECO-MODULATION AS A STRATEGIC LEVER

Eco-modulation should not be a marginal adjustment. It should be a core industrial policy tool. Properly designed, it can:

• Differentiate tyres based on real circular
• performance.
• Incentivise durability and retreadability.
• Penalise short-lifecycle, non-recoverable products.
• Align market behaviour with system objectives.
• To operationalise this, we need new metrics.

FROM COMPLIANCE TO PERFORMANCE: A PROPOSED FRAMEWORK

The next step for EPR systems is to move towards performance-based differentiation. This could be implemented through instruments such as:

• Retreadability Index (RI)
• Performance Score (CPS)

These would measure:

• Number of effective retreading cycles per tyre.
• Structural durability and casing quality.
• Real contribution to lifecycle extension.

Under such a system:

• Tyres with higher retreadability would receive lower eco-fees.
• Products that systematically fail to re-enter the cycle
• would face higher costs.
• This is not just a technical refinement. It is a shift from:
• Generic compliance.
• To intelligent market shaping.

THE LATIN AMERICAN PERSPECTIVE

In Latin America, the stakes are even higher.

The region faces:

• Structural dependence on imported tyres.
• Strong presence of low-cost, low-durability products.
• Emerging EPR frameworks (Chile, Costa Rica, Peru, Ecuador)

Chile, for example, through its EPR law (Ley REP), has made significant progress in structuring collection and recovery targets. However, like many systems, it still faces the challenge of fully integrating reuse strategies into its economic logic. Under these conditions, retreading is not just an environmental solution. It is a strategic industrial capability.

BEYOND WASTE MANAGEMENT

Latin America has a unique opportunity to design EPR systems not only to manage waste

but to govern resources and shape markets.

This means:

• Incentivising retreadable tyres
• Strengthening local retreading industries
• Reducing dependence on short-lifecycle imports
• Building resilience into supply chains

But this requires something critical: policy agility. Because if regulation lags behind market dynamics, it will not transform the system – it will merely formalise its inefficiencies.

A STRATEGIC CONCLUSION

If EPR systems are designed without properly integrating retreading – and without differentiating based on actual circular performance – they risk reinforcing a linear logic under a circular narrative. For emerging regions, this would be a critical mistake

The discussion around repair, reuse and retreading can no longer be treated merely as a waste management issue. It is increasingly becoming a matter of industrial resilience, strategic autonomy and economic security.

As global supply chains face growing pressure from geopolitical fragmentation, logistics disruptions and volatility in raw material markets, extending the useful life of products is emerging as a strategic capability for nations and industries alike.

In this context, Right to Repair should not be understood only as a consumer right but also as an industrial policy tool capable of strengthening local economies, reducing external dependency, preserving technical capabilities and supporting more resilient production systems.

Retreading, remanufacturing and reuse are part of a broader transition where value creation is no longer based exclusively on extraction and disposal but increasingly on intelligence, efficiency and lifecycle management.

CIRCULARITY WITHOUT HIERARCHY BECOMES INEFFICIENCY. REGULATION WITHOUT DIFFERENTIATION BECOMES DISTORTION.

Final note

The future of the tyre industry will not be defined only by how we recycle, but by how intelligently we extend the life of what we already produce. And that requires alignment between:

• Industry dynamics.
• Policy design.
• And strategic vision.

In that equation, retreading must move from the margins to the centre. Because properly understood, it is not just a process. It is a strategic filter, an industrial policy tool and a geopolitical lever.

The Association of Natural Rubber Producing Countries (ANRPC) has released its market report for May 2026, depicting a sector characterised by sustained price strength and firm fundamentals. The global natural rubber market received additional upward momentum from a decline in Brent crude oil prices, which averaged USD 107.14 per barrel during the month. This represented a month-on-month decrease of 8.65 percent, attributed to easing geopolitical tensions in the Middle East and the temporary reopening of the Strait of Hormuz, which collectively bolstered the commodity's outlook.

Global production projections for 2026 stand at 15.337 million tonnes, marking a 2.4 percent increase from the previous year, with growth driven by Thailand, China, India and Malaysia, even as output moderates in Indonesia and Vietnam. Monthly production, however, fell to 997,000 tonnes in May, a year-on-year decline of 4.7 percent, due to seasonal wintering and dry weather conditions across South and Southeast Asia. Concurrently, worldwide consumption is forecast to rise by 1.3 percent to 15.550 million tonnes for the year, with May's consumption reaching 1.310 million tonnes, a 4.6 percent annual increase. This demand was underpinned by steady tyre manufacturing, electric vehicle-related consumption and resilient purchasing managers' indices in China and India, alongside record auto retail sales in India.

Physical prices for all major grades recorded broad-based gains throughout May, with SMR-20, STR-20, RSS-3, RSS-4 and latex all experiencing increases. Trade flows showed a mixed pattern, as imports from China and India contracted month-on-month, while Malaysia and Vietnam registered significant gains. On the export front, Cambodia, Vietnam and Thailand recorded increases, whereas Indonesia and Malaysia saw declines. Currency movements saw the Malaysian ringgit ease slightly, while the Thai baht traded within a stable range, and both nations reported decelerating GDP growth for the first quarter of 2026. Futures contracts on the SHFE and SGX reflected tightening supply and firm demand, posting notable month-on-month gains.

The market outlook remains cautiously balanced against a backdrop of several macroeconomic factors. Elevated trade tensions between United States and China, ongoing geopolitical conflicts and a steady United States Federal Reserve interest rate policy present potential headwinds. However, these are being offset by supportive elements, including the accelerating adoption of electric vehicles, tight feedstock supply due to adverse weather and the positive market sentiment generated by the European Union's decision to lower anti-dumping duties on Chinese tyres.