In West Sumatra, Indonesia, several rubber factories have recently ceased operations due to a shortage of raw latex supplies — a problem rooted in land conversion from rubber plantations to more profitable crops.
Factories Forced to Close Due to Raw Material Shortages
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The decline of the rubber processing industry in Tanah Gadang marks a turning point for the region. According to the West Sumatra Department of Trade and Industry (Disperindag), three rubber factories closed their doors in early 2023.
Wahendra, Head of the Non-Agricultural Industrial Zone at Disperindag, explained that the closures were caused by a severe shortage of natural latex from farmers.
“If factories continue to operate under limited raw material supply, production costs would exceed revenue, leading to losses,” Wahendra said.
The shutdowns began in December 2022, with employee compensation reportedly settled. Only five companies related to rubber remain in the area — and these are suppliers, not manufacturers. Wahendra noted that this will still affect their business, as they rely on the now-defunct factories for processing.
The three closed factories had been operational since the 1980s and 1990s, marking the end of a long era for West Sumatra’s rubber industry. The provincial government and related agencies are now seeking ways to mitigate the impact on local plantations and farmers.
Farmers Turning to More Profitable Crops
According to Ferdinal Asmin, Acting Director of the Office of Plantations and Food Crops of West Sumatra, local rubber plantations are facing a dilemma. Many farmers are converting their land to higher-value agricultural commodities, such as oil palm or food crops.
“Rubber prices have remained stagnant for years,” he said. “Meanwhile, the harvesting process is time-consuming and labor-intensive, offering little financial incentive.”
Despite rubber being one of West Sumatra’s key commodities, the decline in prices and profitability has accelerated land conversion.
To address this, provincial authorities are strengthening the role of Rubber Productivity Management Units (UPH) to improve rubber quality and marketing. These units, managed by farmer groups, aim to enhance processing standardsand ensure that rubber from West Sumatra meets regional quality regulations.
Declining Land Area, Shifting Production Trends
Rubber plantations in West Sumatra are spread across Pasaman, South Solok, Dharmasraya, Sijunjung, Limapuluh Kota, and Padang City.
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In 2021, rubber plantation area was 189,319 ha, dropping to 180,213 ha in 2022 — a reduction of about 106 ha.
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However, production increased from 145,585 tons (2021) to 156,486 tons (2022), a rise of over 10,900 tons thanks to productivity improvements.
The number of rubber-farming households also increased from 139,200 in 2021 to 162,946 in 2022 — an addition of 23,751 households.
“The government will not allow the rubber sector to disappear,” Ferdinal emphasized. “Our goal is to improve rubber quality and maintain its role as a strategic commodity for the province.”
Outlook
West Sumatra’s rubber sector is struggling to survive amidst low prices, rising costs, and competition from alternative crops. However, through quality management programs, improved farmer organization, and potential replanting initiatives, Indonesia aims to revitalize its natural rubber production and preserve this traditional livelihood.