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Govt mulling consolidation of rubber smallholders

The plantation and commodities ministry says this is aimed at increasing rubber production capacity and reducing costs.

Govt mulling consolidation of rubber smallholders

KUALA LUMPUR: The plantation and commodities ministry is examining a model of consolidation or unification of rubber smallholders in clusters of 500 to 1,000ha to increase rubber production capacity and reduce costs.

It will involve three levels in the value chain of the rubber industry – upstream, midstream and downstream.

The ministry said the proposed cluster is expected to be implemented in three states that have a high concentration of uncultivated areas, namely Kelantan (34,621ha), Kedah (24,058ha) and Pahang (19,481ha).

“We are aware of 420,000ha of rubber trees that have matured but have not been tapped. This is due to two factors; lack of tappers and low price of rubber.

“Through the cluster concept, the marketing chain can be shortened where the rubber processing factory buys rubber directly from the smallholder cluster and then gives a more favourable price to the smallholder,” the ministry said in a written parliamentary reply to a question from Awang Hashim (PN-Pendang).

Awang had asked the ministry to state plans to increase the number of estates that were tapped and the short and long-term plans to increase rubber productivity in order to help tappers earn higher income.

According to the ministry, of the 1.1 million ha of rubber estate area in Malaysia, 93% are made up of smallholders and 7% of estates. A total of 217,000 smallholders are involved in natural rubber production in Malaysia with 195,000 active smallholders renewing their rubber transaction authority permit every three years.

The ministry said the government does not plan to increase the area of plantations, but instead would focus on efforts to increase the production of natural rubber from existing rubber trees.

In 2023, Malaysia produced 348,000 tonnes of natural rubber compared to 377,00 tonnes in 2022, while it imported one million tonnes of natural rubber worth RM5.7 billion compared to 1.16 million tonnes worth RM7.2 billion in 2022.

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