Spearheading Second Frontier of Sustainability in Malaysian Rubber Industry

by | Datuk Dr. Salmiah Ahmad, Director General, Malaysian Rubber Board

Brundtland Commission in 1987 defined sustainability as the development seeking to meet the need of the present generation without compromising the ability of future generations to meet their own needs or development that achieve a balance, interdependent and mutually reinforcing economic, social and environmental aspects. In the commodities fraternity sustainability is normally discussed in terms of the effect of an industry to the profit, people and planet (3P). (Diagram 1)

The natural rubber (NR) industry in Malaysia started after the seeds brought by Sir Wickham from the South America were planted in Kuala Kangsar in the 1880’s and started the first commercial planting of rubber in Malaysia. (Diagram 2)

After more than a century, the industry has evolved from being an important component in the agricultural sector to an element to be reckoned with in the manufacturing sector. The diversification strategy implemented under three Industrial Master Plans (IMPs) had stimulated the expansion and the industry evolved from a relatively small and unknown entity to become a reputable major world rubber trader. (Diagram 3)

The introduction of Standard Malaysian Gloves and green material for tyres has placed Malaysian NR gloves superior to the other producers in terms of quality and competitiveness. Currently there is a capacity to produce about 1.5 million tonnes of processed NR and products derived from NR. Majority of the semi-finished or finished rubber products produced are exported to China, EU and USA. When the rubber prices fell in the late nineties, the glory of the rubber industry was quickly forgotten and replaced with the oil palm industry. Strong demand and good product performance revitalized the industry. In fact, in 2010, the industry as a whole contributed about RM34.00 billion in export revenue, increased by more than three times than that of RM10.6 billion in 1990. (Diagram 4)

The socio-economic importance of the rubber industry cannot be denied as it sustains the livelihood of about 400,000 smallholder families throughout Malaysia. Currently the area covered by rubber in the country is approximated to be about 1.02 million hectares and 95% of the area is owned by smallholders, with average productivity of about 1.5tonne rubber/ha/yr. The other 5% is owned by estate with a slightly higher productivity of 1.6tonne rubber/ha/yr . (Diagram 5)

Assuming an average holding of 2.3hectares, rubber smallholders in Malaysia can now earn more than RM2,500 per month. (Diagram 6)

The potential negative effect of the country’s involvement in the rubber industry to the environment is controlled via the introduction of appropriate regulatory measures in place by the year 1979. Technologies for effluent treatment, air pollution and sludge treatment and disposal were established by Malaysian Rubber Board and implemented by the industry. These were found to be sufficient to minimize the possible negative impact of the industry to the environment. Thus to date, after more than 130 years of involvement, no serious detrimental effect on the environment has been detected.

NATIONAL KEY ECONOMIC

ACTIVITIES (NKEA)

Under the 10th Malaysian Plan, the government has outlined various new approaches in order to transform this country to become a high income and high productivity economy, in line with the New Economic Model. The inclusion of the rubber industry in the 12 sectors under the National Key Economic Area (NKEA) indicates that this industry is recognised as one of the important contributors in the economic transformation of Malaysia. (Diagram 7)

Four Entry Point Projects (EPPs) have been identified to be implemented and anticipated to contribute about RM52.9billion to the Gross National Income (GNI) by 2020, compared to RM20 billion in 2010. The four EPP are:-

1. Maintaining the rubber tappable area of one million hectares through replanting and new planting.
2. Increasing yield performance from the current 1.5tonne rubber/ha/yr to 2tonne rubber/ha/yr by the year 2020.
3. Accelerating the growth of existing downstream activities. – Domestic demand for NR is expected to raise in tandem with increasing global demand for Malaysian rubber products particularly rubber gloves. It is estimated that NR consumption in this country will reach 0.65 million tonnes in 2015 and 1.0 million tonnes in 2020. Malaysia NR consumption is driven by glove manufacturing sector where Malaysia controls major world market share in terms of trade. This project aims to increase market dominance to 65% from the current 63%.
4. Introduction of new downstream rubber products (such as Ekoprena and Pureprena). – Malaysia needs to create differentiation in order to remain competitive. This project aims to spearhead the commercial production of niche rubber materials, EKOPRENA and PUREPRENA for the production of green products. The production capacities of these materials are anticipated to be 300,000 tonnes by the year 2020.

LIFE CYCLE IMPACT ASSESSMENT (LCIA)

Life Cycle Impact Assessment is a tool that can be used to evaluate the impact of a product from its inception to its end-use life – cradle to grave. It is an environmental management method for the quantitative evaluation of material resources invested, the environmental burden and the environmental impact of a product or service through all stages of its life cycle (Diagram 8). Life cycle assessment requires a manufacturer to quantify the amount of input and output during the manufacture, usage and disposal of the product. The outputs are quantified in terms of their contribution to the environment (Diagram 9) where:-

• The impact to the atmosphere are measured in terms of the impact to global warming; usually measured in term carbon dioxide equivalent.
• The impact to the water resources are measured in terms of biological, chemical loading and potential to create fouling due to overloading of nutrients (euthrophication).
• The impact of the industry to the soil is measured in terms of acidity, organic loading and biodiversity.

SECOND FRONTIER OF SUSTAINABILITY

LCIA will be able to highlight areas for improvement especially in terms of the utilization of resources. Defining Second Frontier of Sustainability (SFS) as the ability of the industry to optimize the utilization of resources and improving productivity with no or better impact to the environment, (Diagram 10) below are four examples of research and development spearhead by MRB to transform the industry toward SFS.

Current Practices (Example 1)

• Ninety-five percent of the rubber area in Malaysia is owned by smallholders (smallholders are those owning less than 40 hectares of land). Survey by RISDA indicates that their trees are old and they are getting older too. Many smallholders complained of not getting the right NR clone during replanting and as a result getting lower productivity. But it is uncertain whether the smallholders have the competencies to distinguish the different types of clones.
• The current method of producing the planting material is by germinating and growing the rubber seeds to rootstocks, followed by bud grafting with the bud eyes from the right clones, allowing for the new tree to develop and growing to 2 whorls, and then planted in the field. The time taken to grow 2-whorl planting materials from seeds is almost one year.
• Smallholders therefore need to book the 2-whorl planting materials a year ahead from the licensed nurseries. Upon receiving a confirmed order, the nurseries will collect or purchase seeds and then followed through until 2-whorl planting materials are produced. The bottle neck in the production of high quality rubber planting materials is the seeds where there are only two seeds seasons per year. If the seeds falling seasons are missed, the smallholder needs to wait for a year for the supply of new planting materials. Thus smallholders, who do not make prior bookings, usually resort to either buying any planting material available in the market or by planting seedlings grown from seeds. This will of course result in low productivity.

 

 

 

SFS-1: TRACEABILITY TO ENSURE THE SUPPLY OF HIGH QUALITY PLANTINGMATERIALS TO THE SMALLHOLDERS

Under Entry Point Project (EPP) 1 in Rubber NKEA, the MRB research team proposed to ensure the supply of high quality planting materials to the smallholders through the following activities:-

• Establishment of Seeds Production Areas (SPA): Seeds are the cause of the bottle neck in the supply of high quality planting materials. SPA has been established to supply seeds should this be necessary and government to government agreement to supply seeds shall be made should this be necessary. Research into the production of rootstock from tissue culture materials will also be looked into.
• Reduce the number of MRB-recommended clones: Since the smallholders have limited expertise/competency to identify clones, the numbers of recommended clones are optimized to reduce confusion with the hope that the smallholders will slowly learn to at least recognize the characteristics of the recommended clones.
• No Rogue Clones: Rogue clones in the source bushes are destroyed and bud-eyes are obtained from the source bushes in the nurseries. MRB team has verified all trees in the source bushes of the licensed nurseries.
• Establishment of Malaysian Rubber Budwood Center: MRB has been given funding to establish at least 4 Malaysian Rubber Budwood Center (MRBC) to supply bud-eyes for budding purposes
• Production of iKLON: To assist the smallholders and the officers to indentify rubber clone, a special hand-held gadget will be fabricated by MRB Team to enable recognization/identification of the clones – without relying on human-eyes.
• Bar-code for Traceability: Planting materials to be attached with bar-code tag to ensure traceability. Employers involved in the production of the planting materials shall register their company’s name and staff involved in the production of planting materials onto the barcode. This barcode tag will be attached to the planting material. If smallholders are unsure of the clones of the planting materials received, iKLON can be used to identify clones. Nurseries supplying rogue clones to the smallholders will be penalized and MRB is equipped with the right resources and procedures to ensure adherence to this new concept.
• Clone Inspectors; Clone inspectors have been trained by MRB – to support the use of iKLON
• Training on Good Agricultural Practices (GAP): Smallholders will be trained and required to follow GAP to improve productivity
• Anticipated impact: The number of rogue clones supplied to smallholders will be reduced (to zero) and o nly good quality planting material shall be supplied to smallholders. Wastage will be reduced and the productivity/hectare basis of the smallholders areas will be improved due to better clones (zero rogue clones) and implementation of GAP.

Current Practices (Example 2)

• The smallholders will go out in the morning to manual tapped rubber trees.
• Rubber is collected in the form of coagulated latex instead of the liquid latex since collecting latex requires more time.
• The coagulated rubber can be easily contaminated. MRB noted high incidences of this malpractice when the rubber price is high. Contaminated rubber requires additional processing to ensure good quality SMR. Additional processing indicates greater utilization of resources and increase environmental loading.
• Rubber latex can be used to produce solid rubber as well as latex-based goods. Currently there is a high demand of latex in Malaysia and the shortage in supplied through imports from neighboring countries such as Thailand. As stated above the smallholders in Malaysia prefer to produce coagulated rubber.
• Due to old age, about 40% of the smallholders rely on hired help (foreign labours) to tap and manage the fields.
• The number of tapping days will be reduced during rainy days.

SFS-2: AUTOMATIC RUBBER TAPPING SYSTEM (ARTS)

SFS-3: INTEGRATED PROCESSING CENTER (IPC)

Close proximity of processing center: Processing center is placed close to sources of rubber (close to smallholders) to reduce logistic cost and giving better return to smallholders. The rubber will be transferred fresh to the processing unit thereby improving the quality of rubber or the high value co-product to be recovered.

High-value co-product(s) is (are) recovered:Co-products in the process are extracted and processed into high value pharmaceutical products. After extraction the amount of waste that needs to be treated will be reduced and the area required for effluent treatment will be reduced as well. The process water can be recycled therefore reducing cost. The gain in profit may be shared with smallholders

Current Practice (Example 4)

• Malaysian processors are producing solid rubber similar to those produced by the neighbouring countries
• The market is moving towards “green products”

SFS-4: EKOPRENA AND PUREPRENA

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