Malaysia’s natural rubber (NR) sector recorded a month-on-month increase in production for June 2025, offering a sign of recovery for the commodity that has long been a backbone of the nation’s agricultural exports.
The Monthly Rubber Statistics, Malaysia, June 2025 report released by the Department of Statistics Malaysia (DOSM) showed that production rose 5.9% to 25,679 tonnes compared to 24,256 tonnes in May 2025. This upward movement suggests improved harvesting activity and output from key producing regions.
However, the year-on-year comparison paints a more cautious picture, production was still 14.1% lower than in June 2024, when the figure reached 29,881 tonnes.
Chief Statistician Malaysia, Dato’ Sri Dr. Mohd Uzir Mahidin stated that the smallholder sector continued to anchor the industry’s output, contributing 84.7% of June 2025’s production. In contrast, the estates sector accounted for 15.3%, showing that the structure of Malaysia’s NR production remains heavily reliant on small-scale producers.
Smallholders, often operating in rural areas with modest farm sizes, remain the driving force behind Malaysia’s NR supply chain. The June 2025 data reaffirms their role, delivering more than four-fifths of total production.
This dominance reflects the sector’s adaptability in adjusting tapping schedules, responding to price signals, and maintaining production despite fluctuating market conditions. The estates, while larger in size and often more mechanized, contributed a smaller share, highlighting the importance of policies and support targeted at small-scale farmers to sustain overall industry output.
NR Stocks Fall 11.4% as Supply Tightens
Total NR stocks in June 2025 fell to 164,189 tonnes, a decline of 11.4% from May’s 185,324 tonnes. This reduction suggests that domestic supply was drawn down, potentially to meet export commitments or domestic consumption needs.
Breaking down the stock holdings:
- Rubber processors’ factories held the largest share at 85.2%.
- Rubber consumers’ factories accounted for 14.7%.
- Rubber estates held just 0.1%.
The concentration of stocks in processing facilities underscores their central role in the NR value chain, acting as the link between raw production and finished goods for both domestic use and export markets.
Exports Decline 17.3% Month-on-Month
Malaysia exported 29,719 tonnes of NR in June 2025, down 17.3% from 35,939 tonnes in May. The contraction could be attributed to softer demand in certain markets or adjustments in shipment schedules.
Top NR Export Destinations for June 2025:
1. P.R. China – 33.9%
2. Germany – 18.1%
3. United Arab Emirates – 9.6%
4. United States of America – 7.3%
5. India – 3.8%
China’s position as the largest buyer highlights its ongoing dependence on Malaysian NR for manufacturing industries, particularly in automotive and rubber-based product sectors. Germany’s strong demand suggests its industrial base remains an important outlet for Malaysian exports, while the UAE’s share reflects the role of Middle Eastern markets in global NR trade.
Malaysia’s NR export portfolio extends beyond raw rubber, with a significant share derived from NR-based products such as gloves, tyres, tubes, and rubber thread.
In June 2025, gloves maintained their dominance, registering export values of RM1.2 billion. However, this figure marked a 1.7% decrease from RM1.3 billion in May 2025. Gloves, being a critical medical and industrial product, remain a major contributor to Malaysia’s NR export revenue, and even slight changes in demand or pricing can influence monthly performance figures.
The DOSM report recorded price drops in all major NR categories for June 2025 compared to the previous month:
- Concentrated Latex – down 9.0% to 558.66 sen/kg (May 2025: 613.80 sen/kg).
- Scrap – down 7.0% to 564.13 sen/kg (May 2025: 606.67 sen/kg).
- Standard Malaysian Rubber (S.M.R) – all grades showed declines between 8.9% and 10.7%.
The simultaneous decline across categories signals broad market softness, which may be linked to seasonal production patterns, shifts in global demand, or competitive supply from other producing nations.
Balancing Short-Term Gains with Long-Term Trends
While the month-on-month increase of 5.9% in production is encouraging, the year-on-year drop underscores the challenges still facing Malaysia’s NR sector. Lower prices may benefit downstream manufacturers, but they pose revenue challenges for producers, particularly smallholders who face higher operational costs.
The reduction in stocks suggests tighter supply conditions in the short term, yet the decline in exports points to a complex market environment. Producers and policymakers may need to navigate between sustaining production capacity and responding to global demand trends.
Malaysia’s NR industry remains resilient, adapting to market conditions while continuing to supply both domestic and international markets. The sustained contribution of smallholders highlights the social and economic importance of rubber production in rural communities.
Despite lower prices in June 2025, the industry’s ability to maintain output growth compared to the previous month suggests that production systems remain robust. Continued monitoring of export performance, stock levels, and pricing will be essential for gauging the industry’s direction in the coming months.
Shahriena Shukri is a journalist covering business and economic news in Malaysia, providing insights on market trends, corporate developments, and financial policies. More about Shahriena Shukri.
