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The natural rubber (NR) market witnessed a slight recovery in 2019 despite challenges from the global economic environment. The average price of SMR 20 in 2019 was registered at 577.68 sen/kg, an increase of 34.12 sen/kg or 6.3% from 543.56 sen/kg in 2018. Meanwhile, average price of latex in bulk increased by 22.73 sen/kg or 5.3% to 452.63 sen/kg. The increase was contributed by unexpected factors particularly the outbreak of Pestalotiopsis disease (fungal disease), erratic weather conditions and sluggish tapping activities in major rubber producing countries due to prolonged low prices. The timely measures by the International Tripartite Rubber Council (ITRC) member countries on export cutbacks of 240,000 tonnes under the 6th Agreed Export Tonnage Scheme (AETS) beginning 1 April 2019, gave a boost to the rubber prices. However, the increase in rubber prices were limited by unfavourable factors such as uncertainties of the U.S - China trade development, gloomy economic condition, weaker China’s manufacturing activities, declining China’s auto sales and poor sentiment in rubber futures affecting demand to slow down. Based on the NR statistics released by the Association of Natural Rubber Producing Countries (ANRPC), the world NR production eased 0.7% to 13.764 million tonnes in 2019 resulting from fungal disease in major rubber producing countries, while demand fell 1% to 13.704 million tonnes on a slowdown in the auto industry worldwide. We are confident that the unity of MRE members in facing market uncertainties and challenges in 2020 will be a strong component in making sure the Malaysian rubber industry remains competitive and remunerative to its stakeholders.

The Malaysian Rubber Exchange (MRE), which is a Unit under the Malaysian Rubber Board (MRB) functions as a gateway for rubber industry specifically in providing the necessary facilities and services pertaining to the rubber trade. Throughout the year, MRE hosted a series of meetings in line with the roles of MRE, for the promotion, development and proper conduct of the rubber trade in Malaysia. In line with the MRB strategies, the effectiveness of the natural rubber (NR) price discovery mechanism is reviewed from time to time to ensure that reference prices published by MRB are transparent, reflective and credible.

The market needs timely, accurate and useful information to facilitate the industry in business decision-making. In this regard, MRE continues to publish “Daily NR Market Watch” and “KL Rubber Market Newsletter “ (monthly publication) to members to update and share information on the factors influencing NR prices, latest news on global economic scenario and rubber industry as well as market outlook. MRE maintains liaison with other exchanges and trade associations within the ASEAN as well as other rubber trading bodies in the world. MRE participates actively in both the international and regional meetings such as the International Rubber Association (IRA), the ASEAN Rubber Business Council (ARBC) and the International Tripartite Rubber Council (ITRC). MRE had successfully organised a Business and Technical Mission to Shanghai, China from 16 – 21 September 2019. The mission managed to promote closer business ties between Chinese and Malaysian companies, thus paved the way for future cooperation between both countries towards the mutual benefits of the rubber industry.

MRE undertake a variety of networking platforms within the rubber industry fraternity. Among the main activities planned by MRE for 2020 include meetings, seminars, technical and business missions, MRE Annual Dinner and Golf Tournament 2020 and other events organised by MRB. Events such as this allow members to renew their acquaintances and further strengthen their business relationship, which I am confident will lead to greater cooperation and exchange of ideas for the benefits of the industry.

I am confident that MRE homepage in MRB website will serve as an essential and useful reference as well as a comprehensive guide to users in the rubber industry, both within and outside the country. I would like to extend my deepest appreciation to all members for their continuous support and cooperation towards the MRE and the Malaysian Rubber Board throughout the year. As members of the MRE, our strength lies in our concerted efforts towards establishing a united and common front for the betterment of the natural rubber industry. We believe that MRE will keep us united and be prepared for further challenges in the year ahead. The MRE also welcomes your constructive feedback on how its present services could be further improved and value-added, apart from potential activities that could be carried out in order to provide better service to its members. I wish all MRE members every success in your business endeavours.

Thank you.

DATO’ DR. ZAIROSSANI MOHD NOR