Foreign Worker Shortage Biggest Challenge For Rubber Industry – MRC
By K. Naveen Prabu
KUALA LUMPUR, Sept 25 (Bernama) -- The Malaysian rubber industry’s most pressing challenge is the shortage of foreign workers in the downstream manufacturing sector, according to the Malaysian Rubber Council (MRC).
MRC chief executive officer Muhammad Eizaaz Muhammad Redzuan said the industry has requested government assistance to ensure a continuous supply of workers to support production.
“The industry also faces challenges such as rising operating costs for exporters and manufacturers, including higher energy and water tariffs, statutory contributions such as the Employees Provident Fund (EPF), and other expenses.
“We believe discussions between government authorities and industry players are crucial in finding solutions to mitigate these pressures,” he told Bernama after appearing on Bernama TV’s The Nation programme today.
When asked about international demand amid competition from countries like Thailand, China and Vietnam, he said Malaysia still has certain advantages but must lower product costs.
“This can only be achieved through greater use of automation, digitalisation and technological advancement, which will help lower production costs and safeguard business margins in the global rubber products market,” he said.
Muhammad Eizaaz said the geopolitical and economic outlook remains tough in view of the political tensions, United States (US) tariffs and stricter compliance and sustainability requirements, but stressed that there are ways to navigate these challenges.
Earlier on the programme, he highlighted that Malaysia has transitioned from being the world’s top raw rubber supplier to becoming a major manufacturer of high-value products such as gloves, tyres and engineered rubber goods.
He said total exports of rubber and rubber products stood at RM33.5 billion in 2024, with the rubber glove sector contributing nearly 40 per cent.
“Rubber gloves are a very prominent, strategic industrial initiative undertaken by our exporters,” he said.
However, he said the figure is nearly half of the “black swan” years of 2020 and 2021, when pandemic-driven demand pushed exports close to RM60 billion.
“We can do better, as RM33.5 billion is nearly a 50 per cent drop from the pandemic years. While competition and geopolitical tensions persist, we aim higher by strengthening our market share in the US, Europe and ASEAN,” Muhammad Eizaaz said.
He also noted that while the US remains Malaysia’s largest export destination for rubber products -- accounting for 33 per cent of shipments -- emerging markets such as Egypt and South America are being tapped to cushion the risks of tariffs and trade barriers.
“These new markets cannot replace the US, which is a premium market with higher prices and a large consumer base, so our strategy is to supplement it rather than replace it,” he said.
--BERNAMA