The EU Deforestation Regulation (EUDR) poses both challenges and opportunities for member companies of the Vietnam Rubber Group (VRG). With proper preparation, this regulation could open up new export markets for Vietnamese rubber. Starting in 2024, VRG has introduced a minimum price policy for PEFC-certified sustainable rubber, with prices at least USD 10 higher per ton than standard grades.
Expanding PEFC-Certified Products
On June 23, 2023, the European Union (EU) issued the EU Deforestation Regulation (EUDR) to take effect in January 2025, banning the import of seven categories of goods linked to deforestation. Its goal is to prevent deforestation and forest degradation, contributing to environmental protection and climate change mitigation.
Agricultural commodities traded in the EU must now prove they are deforestation-free throughout their supply chains. Other markets such as Japan, South Korea, and the United States are also expected to align with these sustainability standards, reflecting a global shift toward green transition and carbon reduction.
For Vietnam’s rubber industry, this means an opportunity to restructure operations toward transparency, accountability, and sustainability — thereby improving competitiveness in global markets.
In 2023, the EU was Vietnam’s third-largest market for rubber, importing USD 469 million, or 6.5% of total exports. Despite strict regulations, the EU market remains highly lucrative and far from saturated.
Additionally, a significant volume of Vietnamese natural rubber is processed in China, which then exports finished rubber products to the EU. As these Chinese exports must now comply with EUDR, Chinese buyers will increasingly demand EUDR-compliant natural rubber from Vietnamese suppliers.
According to Mr. Tran Nhu Hung – Head of VRG’s Business Market Department, “To meet EUDR criteria, export-oriented enterprises must finalize documentation and compliance systems by 2024. Rubber and wood are already subject to the VPA/FLEGT Agreement with the EU, committing to legal and deforestation-free exports. Since Vietnam stopped logging natural forests in 2014 and regulates land conversion since 2017, the country is well-positioned to comply with EUDR.”
He added: “VRG is actively implementing sustainable forest management and certification programs across plantations to meet EU standards. For 2024, the Group has set a price floor premium of at least USD 10/ton for PEFC-certified products.”
Adapting Sales Policies and Expanding Markets
Although global supply shortages create favorable conditions, 2024 remains challenging due to geopolitical tensions and sluggish global demand. To address this, VRG’s Business Market Department is expanding customer networks and diversifying export channels.
Key measures include:
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Cost optimization to maintain profitability despite low selling prices.
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Weekly rubber market bulletins using verified global data sources.
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Active participation in international rubber organizations and associations for market intelligence and price forecasting.
VRG is also accelerating digital transformation and customer service management through information technology. Collaboration with the Vietnam Commodity Exchange (MXV) is moving forward — a Rubber Exchange Platform is under development, with a demo version ready for testing in 2024. This platform will enable transparent online tradingfor rubber and wood products.
In addition, VRG is studying the establishment of centralized warehouses and logistics hubs to enhance export packaging, improve delivery times, and serve demanding clients.
Strengthening Partnerships and Promoting Sustainable Products
VRG maintains close cooperation with Vietnamese trade counselors abroad, actively participates in trade fairs, rubber expos, and tire industry conferences, and plans to explore new markets in West Africa (Ivory Coast) in 2024.
At the same time, VRG continues to nurture relationships with major global rubber buyers — particularly industrial rubber and tire manufacturers — through long-term contracts ensuring stable demand and pricing.
The Group is also promoting certified sustainable rubber (PEFC, FSC, EUDR-compliant) to strengthen its position in international supply chains. Marketing efforts emphasize VRG’s image as a responsible, sustainable, and transparent enterprise.
Mr. Tran Nhu Hung noted:
“Together with VRG’s technical departments, we are restructuring the rubber product portfolio to match global trends and expanding into high-value industrial rubber markets. Our goal is to maximize economic returns while building a resilient, sustainable brand for Vietnamese rubber.”