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China’s Slowing Demand for Tires Sparks Thai Rubber Makeover

China’s Slowing Demand for Tires Sparks Thai Rubber Makeover2019.12.19

Condoms and car tires helped make Thailand a $6 billion latex powerhouse. Now, the industry wants to plaster the plant material on faces and use it to stop coastal erosion in a makeover designed to keep more rubber profits at home.

Thai rubber, which has traditionally ended up in foreign tires, gloves, and other manufactured products, is reeling from slowing car sales in China, the world’s top consumer. Futures prices for the commodity are up 17% this year after sliding in five of the previous six years.

rubber latex

Thailand, the world’s biggest rubber producer and exporter, is trying to buffer that impact by promoting alternate uses, from erosion-prevention to anti-aging creams. The country produces more than a third of the world’s natural rubber, with about 80% exported as a lower-value commodity.

“We shouldn’t just export rubber anymore,” said Sunan Nuanphromsakul, acting governor of the Rubber Authority of Thailand, a regulatory agency, in an interview in Bangkok. “Processing it locally is crucial to adding more value.”

Already, the country has benefited from the relocation of tire-manufacturing from China, and aims to expand its domestic use as a cushioning base for playgrounds, and in rural road surfaces.

Even still, rubber needs to extend its uses -- and that requires product innovation, said Uthai Sornlaksap, president of a producers’ network that represents about 100,000 rubber-tree farmers.

‘More Creative Ways’

“If we want to compete globally, we have come up with more creative ways,” he said. One example being developed by a local company uses rubber in a stand-like device designed to catch marine sediment and stabilize newly planted mangroves.

The root-guarding system is designed to protect estuarine areas from coastal erosion. It contains about 40% natural rubber, compared with the roughly 25% in tires and less than 20% in rubberized roads, according to Uthai, who estimates that 1 million tons of natural rubber could be used to cover hundreds of kilometers of vulnerable Thai shorelines.

Cosmetics are also emerging as a high-value user of rubber.

Rapepun Wititsuwannakul, who has studied rubber for three decades as a biochemistry professor at southern Thailand’s Prince of Songkla University, has found antioxidant properties in the plant material that could fight the physical effects of aging. Even better, cosmetic applications use material that’s typically junked.

“We’re using a lot of latex sap, and only the part that’s always discarded,” she said.

The university, in the rubber industry’s heartland, is pooling 400 liters (106 gallons) of rubber sap daily from local growers for extraction and research. There’s the potential to process as much as 1 million liters if sap-laced cosmetics and dietary supplements prove viable, she said.

‘Great Potential’

“It has great potential to boost farmer’s income,” Rapepun said. “There’s so much we could do with rubber and its extracts.”

Her research caught the attention of Thai entrepreneurs Pondanai Somjaiman and Wuttichai Chalermwutanon, who have used it to make a skin application designed to fight wrinkles, and improve skin tone and complexion. Their product, sold as “Apara,” contains 4% of the latex sap extract and retails for about $45 for a 100-milliliter bottle.

About 200 liters of the rubber-sap byproduct are needed to make 1 kilogram (2.2 pounds) of the product, which Pondanai says represents another way to siphon more money from rubber. Both his and his partner’s families own rubber plantations.

“We’re both familiar with the rubber industry, and heard stories of the impact of prices,” he said. “More demand for new products means less reliance on foreign rubber markets.”

Source: Bloomberg

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