32
Figure 11 Production, Consumption and Export of Natural Rubber in Thailand, 2003 – 2012
Source: Author’s elaboration with data from FAO, 2013; UNCOMTRADE, 2014; IRSG 2014
The production surplus of natural rubber produced in Thailand, Indonesia and Malaysia are exported to other countries. As these three countries have an
extensive production surplus, they have become the largest natural rubber exporting countries in the world. Thailand’s greatest total exports occurred in
2003, with numbers that were much higher than exports in the years thereafter. The falling trend in Thailand’s exports since 2003 is due to the intense
competition with the supply of natural rubber from Indonesia Figure 11
Figure 12 Production, Consumption and Export of Natural Rubber in Indonesia, 2003 – 2012
Source: Author’s elaboration with data from FAO, 2013; UNCOMTRADE, 2014; IRSG 2014
1000000 2000000
3000000 4000000
Ton n
es
Year
Production Quantity Tonnes
Consumption Tonnes
Export Tonnes
500000 1000000
1500000 2000000
2500000 3000000
3500000
Ton n
es
Year
Production Quantity
Tonnes
Consumption Tonnes
33 In Indonesia, the largest exporting year occurred in 2011, with an amount
of 2,473,532 tonnes Figure 12. The establishment of bilateral cooperation with many large countries, such as China, is one of the main causes behind the
increasing trend of Indonesias natural rubber exports. The largest export year in Malaysia occurred in 2006 Figure 13, although the Malaysian export volume
went through a period of decline from 2006 to 2012. This decline is directly related to the overall decrease in Malaysian natural rubber production. Another
impact is the domestic consumption also decreased during this period.
Figure 13 Production, Consumption and Export of Natural Rubber in Malaysia, 2003 – 2012
Source: Author’s elaboration with data from FAO, 2013; UNCOMTRADE, 2014; IRSG 2014
6 RESULT AND DISCUSSION
6.1 Competitiveness of Natural Rubber in the International Market
The export performance of natural rubber in the international market can be seen as a comparative advantage. As expressed by Balassa, in Bulange 2008, a
method that can be used to analyze the competitive and comparative advantages of a commodity in the international market is the Revealed Comparative
Advantage RCA method. In this section, the RCA will be used to analyze the three main exporters in the international market Thailand, Indonesia and
Malaysia, as well as each primary importing country.
6.1.1 Revealed Comparative Advantage RCA of Natural Rubber Major Exporter
Thailand, Indonesia and Malaysia are the top three producing and exporting countries of natural rubber in the world, producing nearly 70 of the world’s
natural rubber. Thailand is the world’s largest producer and exporter of natural rubber, with a production of roughly 3 million tons, or 40 percent of global
production annually. Meanwhile, Indonesia is the second largest natural rubber
200000 400000
600000 800000
1000000 1200000
1400000
Ton n
es
Year
Production Quantity
Tonnes Consumption
Tonnes
Export Tonnes
34 producer and exporter in the world, producing around 2-3 million tons per year, or
approximately 30 percent of global production. Malaysia is the third largest producer and exporter with approximately 1 million tons per year, accounting for
around 10 percent of the world’s total production.
The estimation results of the RCA analysis for natural rubber, in the period from 2003 through 2013 shows that the natural rubber production in these three
countries have a comparative advantage in the international market as indicated by an RCA value greater than one Table 8. The average value of the RCA for
Thailand, Indonesia and Malaysia respectively, are 29.66, 29.36 and 9.15. If the RCA value is greater than one, it indicates that the share of the natural rubber
commodity, out of all commodity categories, that is exported from the three main exporter countries is greater than the share of the natural rubber commodity
worldwide. From the three main exporter countries, Thailand has the highest RCA, followed by Indonesia and Malaysia.
Thai natural rubber has the highest average of RCA in comparison to the other top exporting countries, although in some periods Indonesia could surpass
Thailand’s RCA. The high RCA in Thailand is primarily due to the high proportion of exports coming from natural rubber in relation to all exported
commodities. Thai natural rubber exports have reached accounted for an average of 4 percent of all exports from 2003 to 2013, while reaching as high as 6 percent
in 2011. This indicates that natural rubber is one of the most important commodities in Thailand, where rubber plantations occupy roughly 3 million
hectares of land, mostly in the southern region where climatic conditions further enable enables high yields about 76 tons of rubber per hectare. Furthermore, the
Thai government has made strategic plans in an effort to boost the number of rubber plantations in the northern, eastern and central regions, which will ideally
raise natural rubber production by an additional 250,000 tons by 2017 TCEB, 2014.
Table 8 The Estimation Results of Revealed Comparative Advantage RCA of Natural Rubber in International Market
Year Thailand
Indonesia Malaysia
2003
39.21 27.56
10.14
2004 36.83
31.63 11.24
2005
34.55 31.06
11.11
2006 32.64
33.66 10.98
2007
30.40 35.34
10.05
2008 30.11
34.84 9.64
2009
29.07 28.65
8.29
2010 24.16
27.76 8.61
2011
22.15 22.24
7.35
2012 18.16
19.73 5.33
2013
28.99 30.46
7.85
Average 29.66
29.36 9.15
Source: Author’s elaboration with data from UN COMTRADE, 2014
