Rubber

Main uses and applications

Within the region, Thailand and Indonesia produce the highest global shares of natural rubber, accounting for 33% and 22% respectively, with other top producers including China, the United States, Malaysia, Japan and South Korea. Synthetic rubber is commonly used in place of natural rubber and currently is the more commonly used variety, primarily as it is cheaper to produce, with approximately 60% of tires being made from synthetic rubber.

Its high tensile strength, ductility and elasticity mean that latex-based materials and products are physically resilient while remaining flexible and able to be moulded to almost any desired shape. These properties mean that rubber is used for a range of different engineering applications, particularly in the automotive industry. Most of the natural rubber produced globally is used to produce tires for the automotive industry, with 80% of rubber used in the transport sector. Natural rubber is also used in several other sectors, including in the manufacture of medical equipment such as surgical gloves and in consumer goods, including toys, balloons and footwear.

There are several ESG risks associated with natural rubber’s supply chain, with the most severe issues relating to deforestation and the associated negative impacts on biodiversity, as well as water pollution, poor working conditions, labour rights violations, Indigenous Peoples’ rights and land displacement. The highly fragmented and complex nature of natural rubber production, which is primarily harvested by smallholder farmers, makes it hard to establish traceability and, consequently, to effectively assess whether basic environmental, social and governance standards are met within the rubber supply chain.