RUBBER DOWNSTREAM INDUSTRY DEVELOPMENT IN INDONESIA: CURRENT STATUS, OPPORTUNITIES AND CHALLENGES potx

 Natural rubber is one of the great economic and social function for Indonesia  no doubt for environment conservation  Rubber export earning in 2008 accounted for US$ 6.057 billion or

RUBBER DOWNSTREAM INDUSTRY

 Natural rubber is one of the great economic and social function for Indonesia

 no doubt for environment conservation

 Rubber export earning in 2008 accounted for US$ 6.057 billion or about 26% of estate crops export value.

 Domestic consumption in Indonesia in 2008 was 414,000 tons accounted 15.0 % of the total production, ( 65 % was consumed by tyre industries ).

 Development of rubber downstream industry: increasing the added value, increase the consumption of natural rubber in the country, reducing imports of rubber goods, increase employment and foreign

Annual grown of production in Indonesia

Rubber Plantation Area Percentage

INDONESIAN RUBBER PLANTED AREAS

Indonesia rubber export by type and grade (metric tons),

Export performance of Indonesian natural rubber, 2003 – 2008

Clasification of rubber goods industry in Indonesia

a Tyre (bicycle, motorcycle, passenger cars, etc)

b Engineering rubber goods for industry and automotive

(conveyor belts, automotive component, electronic

component, bearing, etc)

c Latex goods (glove, condom, rubber thread, balloon, etc)

d General rubber goods (carpet, footwear, sports goods, etc)

Indonesian Rubber Goods Industries

Industry Amount

Motorcycle and car tyre industries 19 Bicycle tyre industries 7 Engineering rubber goods industries 56 Latex goods industries 51 General rubber goods industries 85

Export-import balance of rubber goods in Indonesia

Vol Value Vol Value Vol Value Vol Value Vol Value

(metric tons)

(million US$)

(metric tons)

(million US$)

(metric tons)

(million US$)

(metric tons)

(million US$)

(metric tons)

(million US$) Export 282 568 371 757 383 935 416 1126 458 1274 Import 101 229 90 239 105 328 106 390 142 404 Balance 181 340 281 518 278 608 310 735 316 870

Export-import balance of rubber goods in Indonesia

0 200 400 600 800 1000 1200 1400

Rubber goods trade balance in Indonesia, 2006 – 2008

Type 2006 (million US$) 2007 (million US$) 2008 (million US$)

Export Import Balance Export Import Balance Export Import Balance

1,051,1

16,5(28,7)

16,63,7

2,539,8

14,1(36,1)

14,03,1

3,341,5

11,7(37,4)

Transmission

belts

Government-owned Rubber Downstream Industries Profile

 10 government-owned companies and one a subsidiary company which

runs business on rubber commodity: PTPN I, PTPN II, PTPN III, PTPN V, PTPN VII PTPN VIII PTPN IX, PTPN XII, PTPN XIII PTPN XIV, and PT Rajawali

Nusantara Indonesia (RNI).

 PTPN III, PTPN V, PTPN IX, PTPN XIII, and PT RNI ever and is developing

rubber goods industry.

Company Subsidiary company Product

PTPN III PT IKN

Rubber articles Master batch Rubber thread Resin

Resiprene 35 is cyclized natural rubber soluble in odorless solvent, particularly in aliphatic hydrocarbon and cheap blends of

•Easy to handel

•No Pollution created by carbon black addition

•Shorter mixing times

Export of Indonesian Rubber Products (000 US$) Jan-Nov 2008

Business of natural rubber will continue to grow and sustainable because it supported a variety of

factors including: the use of natural rubber in line with population growth and the raw materials are

renewable

 Export of rubber goods generally good growth in terms of export volume and value.

 Export growth rates are generally higher than import growth

( However, in terms of each type of product, there are several rubber

products so that the negative trade balance ).

 Positive trade balance is always achieved from the tyre industry and other industries that require a lot of natural rubber.

 rubber goods industry with the main raw material of synthetic rubber, Indonesia still needs a lot of imports, so that the

negative trade balance, such as conveyor belts industry

Import Of Synthetic Rubber

2007

Jan-Nov 2008

Change (%)

 The price of natural rubber as a raw material is very fluctuate,

on the other hand rubber goods prices are relatively stable and even tends to increase

 This opportunity is caught by PTPN by planning to build new

industries or developing the existing rubber downstream

industries to obtain added value or higher profitability

CHALLENGES ( For Government-owned Rubber Industry/PTPN )

 Business of government-owned plantation enterprise (PTPN) may be more developed and sustainable when integrating the upstream industry with downstream industries that have high added value.

 Balance of exports and imports used to analyze the products to be developed prospectively (The products with negative export-import balance : import substitution, the products with positive export-import balance : increase the export value).

 Development of government-owned rubber downstream industry have two target programs: the development of new downstream industries

CONCLUSION

 Population growth and recovery of the Indonesia economy will have a positive impact on business including business on rubber products.

 Awareness of people on environment leads to increase

in the use of natural-based products.

 Positive prospect on rubber business has to be responded quickly in order to catch up the opportunity.

 By improve the knowledge and skills of human resources in the technology, equipment and marketing network, a significant increase in contribution to the

 IRRDB

 IRRI

ACKNOWLEDGMENT

Production and trading motorcycle in ASEAN