The price of Cambodian natural rubber has seen a remarkable hike underpinned by surging global demand for raw materials in a rubber manufacturing industry that continues to stretch in production and remains largely unscathed by Covid-19.
Agro-industrial tycoon Mong Reththy said the price of Cambodia Standard Rubber 10 (CSR10) rubber had jumped to $1,400 per tonne on Monday, up from $1,314 last month.
The rates for higher grades of rubber and rubber products that day were $1,500 per tonne for CSR5, $1,530 per tonne for CSR L and $2,200 per tonne for Rubber No 3 Smoked Sheet (RSS3), according to Reththy.
Reththy is the board chairman of conglomerate Mong Reththy Group Co Ltd, which has rubber, palm oil and mango plantations.
“This is good news for small, medium and large farmers who are engaged in agriculture and agro-rubber industry,” he said, adding that for the time being, the main problem is a lack of labour to harvest the commodity.
“If the price of rubber goes up, then we’ll dole out higher wages – there’d be no shortage of labour and we could harvest more rubber,” he said.
He noted that the jump in price has been further driven by recent adverse weather events that have disrupted tapping in rubber-producing countries.
“The impact of natural disasters and floods has affected the rubber harvest, leading to insufficient supply of rubber to the market, which is pushing up rubber prices now,” Reththy said.
Kou Phally, the deputy head of the Rubber Development Department under the Ministry of Agriculture, Forestry and Fisheries’ General Directorate of Rubber, told The Post on Tuesday that the purchase price of local household rubber had risen significantly to 2,500-2,700 riel ($0.61-$0.66) per kg.
“Rubber prices have started to rise sharply since the beginning of October, as Covid-19 creates greater demand for the commodity to produce gloves and tyres,” he said.
According to Phally, domestic rubber prices will continue their climb for the foreseeable future as more growers shift to other various cash crops.
Major rubber producers have reported between 500,000-800,000ha of trees at risk for disease transmission, which is bound to trim supply, he said.
He pointed out that rubber prices in the Kingdom have seen an overall downward trend since 2012.
Heng Sreng, the general manager of rubber producer and exporter Long Sreng International Co Ltd, which runs the Boeung Ket Rubber Plantation in Kampong Cham province, told The Post on October 8 that his company’s rubber exports had fallen by about 30 per cent.
Due to market and price issues, he said, his company has shifted away from rubber plantations to yellow banana plantations, which are in high demand in China. So far, his company’s banana plantation has grown to more than 2,000ha.
“As the price of rubber continues to fall gradually, I decided to cut down many hectares of rubber trees to plant yellow bananas because bananas are more expensive and bring a larger profit,” he said.
Cambodia exported 179,621 tonnes of rubber in the first nine months of this year, a jump of 3.78 per cent from the same period last year, ministry figures show.
Rubber plantations in Cambodia account for a total of 403,195ha. Of this, 290,609ha (72 per cent) are tapped for latex, while the remainder are in their immature phase and have yet to deliver their first harvest.