The Malaysian government has no plans to replace rubber plantations with kenaf or bamboo, according to Deputy Prime Minister Datuk Seri Fadillah Yusof. While many rubber plantations have been converted to oil palm in recent years, he stressed that maintaining rubber production remains essential to the nation’s economy.
Rubber Production Still a Priority
Responding to questions about whether the Ministry intends to shift to kenaf or bamboo due to their shorter maturity cycles and commercial potential, Mr. Fadillah said:
“In fact, we have launched a pilot project to encourage latex production because latex commands a better price—around 5 RM per kilogram. Through latex production, smallholders and tappers can sell directly to processing factories without intermediaries, helping them earn higher incomes.”
He added that the pilot project will run for one year, beginning in Perak, followed by expansion to Kedah and Sabah.
Malaysia Still Imports Rubber to Meet Domestic Demand
When asked why Malaysia continues to import rubber from Thailand, Vietnam, and Africa, the Deputy Prime Minister explained that domestic output is insufficient to meet local industrial demand, especially in the latex-based rubber manufacturing sector.
“Last year, Malaysia’s rubber products industry required about 365,000 tonnes of raw material, while domestic latex production fell far short of that. Our processing sector has an estimated annual production capacity of 1.5 million tonnes, so imports are necessary to sustain operations and remain competitive,” he said.
According to government data, domestic latex production in 2022 met only around 4% of national consumption. Despite this, Malaysia’s exports of latex-based rubber products, such as rubber gloves, reached RM 21.3 billion, accounting for 78% of total rubber product export revenue.
Supporting Smallholders through Value Creation
Mr. Fadillah emphasized that the government’s priority is not to replace rubber but to revitalize the latex segment and improve smallholder livelihoods through higher product value and shorter supply chains.
The pilot program aims to create a sustainable production model that connects smallholders directly with manufacturers, ensuring fairer prices and stronger participation in the downstream value chain.