Rub­ber mixed, lesser com­mod­it­ies cocoa and pep­per remain resi­li­ent

Malay­sia’s rub­ber industry recor­ded a mixed per­form­ance this year, with out­put and exports, includ­ing external demand for gloves con­tract­ing, while the lesser com­mod­it­ies of cocoa and pep­per bucked the trend by show­ing resi­li­ence.

Exports remained robust amid rising global demand, espe­cially for cocoa and pep­per, des­pite ongo­ing struc­tural con­straints and broader mar­ket uncer­tain­ties.

Over­all, the rub­ber sec­tor was char­ac­ter­ised by weaker pro­duc­tion des­pite monthly fluc­tu­ations, resi­li­ent export activ­ity and uneven price move­ments.

The Depart­ment of Stat­ist­ics Malay­sia (DOSM) said nat­ural rub­ber (NR) out­put fell 14.8 per cent to 26,647 tonnes in Septem­ber 2025 from 31,285 tonnes in August.

Des­pite the lower out­put, Malay­sia’s NR stocks increased mar­gin­ally by 0.7 per cent to 159,629 tonnes in Septem­ber com­pared with 158,157 tonnes a month earlier.

Rub­ber pro­cessors held the bulk of invent­or­ies at 81.9 per cent, fol­lowed by rub­ber con­sumer factor­ies (18.0 per cent) and estates (0.1 per cent).

Exports of NR stood at 33,548 tonnes in Septem­ber, a 15.1 per cent decline from 39,517 tonnes in August, while export per­form­ance con­tin­ued to be sup­por­ted by down­stream rub­ber-based products, includ­ing gloves, tyres, tubes and rub­ber threads.

Gloves remained Malay­sia’s lead­ing rub­ber-based export, val­ued at RM1.1 bil­lion in Septem­ber 2025, an 8.2 per cent drop from RM1.2 bil­lion the pre­vi­ous month.

To date, domestic nat­ural rub­ber pro­duc­tion is estim­ated at around 350,000 tonnes — still con­sidered sus­tain­able — although demand exceeds one mil­lion tonnes.

Another Strong year for Cocoa

Malay­sia’s cocoa industry recor­ded another strong year, with export earn­ings expec­ted to reach RM15 bil­lion by end2025, sup­por­ted by robust global demand, solid down­stream pro­cessing activ­it­ies and a renewed push to revital­ise upstream pro­duc­tion.

The Malay­sian Cocoa Board (MCB), said the sec­tor recor­ded RM9.69 bil­lion in export rev­enue in the first half of 2025 (1H 2025), keep­ing it on track to match last year’s RM15.06 bil­lion per­form­ance, one of the highest in the industry’s his­tory.

Malay­sia also retained its pos­i­tion as one of the world’s top five cocoa grinders, with an annual pro­cessing capa­city of around 368,000 to 370,000 tonnes, rein­for­cing its status as a major global hub for cocoa-based ingredi­ents and con­fec­tion­ery products. However, the upstream seg­ment con­tin­ues to face struc­tural chal­lenges. Domestic cocoa bean pro­duc­tion — though improv­ing from 269 tonnes to 445 tonnes — remains far below pro­cessing require­ments, for­cing man­u­fac­tur­ers to rely heav­ily on imports.

Industry play­ers warn that this reli­ance increases vul­ner­ab­il­ity to global sup­ply dis­rup­tions and volat­ile world prices.

Pep­per robust in 2025

Malay­sia’s pep­per industry also delivered a robust per­form­ance in 2025, driven by sur­ging prices, stronger exports and grow­ing global demand for high-qual­ity Malay­sian pep­per, des­pite struc­tural con­straints in pro­duc­tion capa­city.

The Malay­sian Pep­per Board (MPB) said black pep­per prices jumped 51 per cent this year to RM27,240 per tonne, com­pared with RM18,066 per tonne in 2024, while white pep­per prices recor­ded a sim­ilar trend, rising 43 per cent year-on-year to RM37,407 per tonne — one of the strongest ral­lies in recent years.

Pep­per exports grew in tan­dem with higher prices, reach­ing RM186.67 mil­lion in 2024, up 24 per cent from 2023 driven by strong demand from Japan, China, South Korea and Europe.

Japan remained the largest single des­tin­a­tion, account­ing for nearly half of Malay­sia’s total pep­per ship­ments due to its pref­er­ence for high-grade vari­et­ies.

Pro­duc­tion also registered mod­er­ate improve­ments, with total cul­tiv­a­tion area expand­ing slightly to 8,301 hec­tares, sup­por­ted by 39,517 registered small­hold­ers under MPB’s devel­op­ment pro­grammes.

Out­look for 2026

The Malay­sian Rub­ber Board (MRB) will estab­lish a RM600 mil­lion Research Centre of Excel­lence under Budget 2026 to ensure the industry’s long-term sus­tain­ab­il­ity.

The board will also develop the Stra­tegic Plan 2026–2030 to chart a more sus­tain­able path for the coun­try’s rub­ber industry, boost­ing pro­ductiv­ity, driv­ing innov­a­tion through research and devel­op­ment (R&D), empower­ing sup­port ser­vices, and strength­en­ing oper­a­tional effi­ciency and gov­ernance.

For cocoa, the gov­ern­ment — through MCB — has alloc­ated RM19 mil­lion from 2024 to 2026 for the Cocoa Farm Rehab­il­it­a­tion Project to enhance cul­tiv­a­tion nation­wide, as a key source of the coun­try’s eco­nomy.

It will also imple­ment the Cocoa Yield Pro­duc­tion Stim­u­lus Pro­gramme to expand planted areas by 550 hec­tares and to facil­it­ate mini cocoa pro­cessing infra­struc­ture.

To keep pace with rising global demand, the gov­ern­ment aims to expand cocoa cul­tiv­a­tion to 10,000 hec­tares by 2030 from the cur­rent 5,985 hec­tares, under the Cocoa Cul­tiv­a­tion Pro­mo­tion Pro­gramme.

As for pep­per, the gov­ern­ment and MPB are intensi­fy­ing efforts to expand cul­tiv­a­tion bey­ond tra­di­tional areas, accel­er­ate replant­ing, and pro­mote down­stream ven­tures, includ­ing premium pro­cessed pep­per, nut­raceut­ical applic­a­tions and higher-value spice products.

MPB is also advan­cing industry trans­form­a­tion through mod­ern tech­no­lo­gies such as fer­tig­a­tion sys­tems, Inter­net of Things (IoT), drones and hyper­spec­tral ima­ging, while digital tools like Lad­aGo, Dr Lada and Nutri­Lada help farm­ers man­age crops more effi­ciently.

Together with MyGAP and MyOr­ganic cer­ti­fic­a­tions, these ini­ti­at­ives are open­ing doors to premium mar­kets, fur­ther strength­en­ing Malay­sia’s pos­i­tion as a pro­du­cer of highqual­ity pep­per on the global stage.