According to the International Tripartite Rubber Council (ITRC) – made up of Thailand, Malaysia and Indonesia – global production of this commodity is set to fall by 800,000 tonnes in 2019. The cause is the spread of a fungal disease in the plantations of the three producer countries. In Indonesia, 382,000 hectares had been affected by 1 October, whereas the disease had contaminated 50,000 hectares in Thailand. In Malaysia, 2,135 hectares were affected by defoliation between November 2017 and September this year. According to the ITRC, the weak prices for rubber over the past few years discouraged the producers from using enough fertiliser, which reduced the resilience of the trees and made them vulnerable to disease. However, the lower volumes have not resulted in an end to the downward trend for prices because of high stocks and weak demand in China due to trade tensions with the United States. So the cartel of the three producer countries has reduced its exports of rubber by 440,000 tonnes, almost twice the reduction in April.
Source: Agence Ecofin