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Market trend changes and how to export rubber sustainably?

08:09 | 02/07/2022

VCN - Rubber consumption in the world is changing. Regulations on the legality and sustainability the import raw materials to create products are increasingly strict. Sustainable natural rubber production in the future is the inevitable direction of Vietnam.

illustration image. Source: Internet
illustration image. Source: Internet

The sustainable natural rubber has many opportunities

The report "Sustainable natural rubber production in Vietnam: Current situation and some concerns" has just been published by Forest Trends. It showed that Vietnam is the third-largest country in the world in terms of the supply of natural rubber.

Like other agricultural and forestry sectors, the development engine of Vietnam's rubber industry is based on export. Currently, the two main export items of the industry are natural rubber and rubber products. In addition to these two groups of export products, there are also wood products made from export rubber wood.

From the perspective of the world market demand for sustainable natural rubber, To Xuan Phuc, a policy analyst (Forest Trends Organization) said that rubber consumption in the world is changing a lot. Regulations on the legality and sustainability of the input rubber raw materials to create products are increasingly strict. Furthermore, the demand for sustainable natural rubber is existing in Vietnam.

Recently, Yulex Company – a global company that is using FSC sustainable natural rubber, has made survey trips to a number of rubber companies and smallholders to find out the possibility of making linkages in order to promote sustainable rubber production in Vietnam.

The representative of Yulex Company has made strong commitments on the underwriting product output and paying higher prices than market prices for normal rubber products if these units have a sustainable supply of natural rubber, especially rubber with FSC certificate for Yulex.

Similarly, Weber and Schaer Company – a global company with 170 years of experience in the rubber industry headquartered in Germany, has conducted surveys and commercial activities in Vietnam, and made similar commitments in terms of product consumption and paying higher prices for sustainable natural rubber products. Vietnam has great opportunities in the market if Vietnam can produce this item in the future.

Creating a legal framework to promote rubber forest management

Assessing that sustainable natural rubber production in the future is an inevitable direction of Vietnam, Mr. To Xuan Phuc said that this is an opportunity for Vietnam to improve the economic value per unit of output. At the same time, it helps to ensure compliance with strict environmental and social requirements in the production stages.

There are currently two sustainability certification systems in the world; PEFC (Programme for the Endorsement of Forest Certification) and FSC (Forest Stewardship Council). The FSC criteria is considered to be stricter than those of PEFC.

Vietnam has developed a National Forest Certification Scheme (VFCS). This system is recognized by PEFC. So far, Vietnam has about 97,300 hectares of rubber area certified by VFCS. This entire area is owned by state rubber companies.

“Despite the rapid expansion of certified acreage, the certified acreage is still not commensurate with the industry's potential. All small rubber plantations have not been certified so far. In particular, Vietnam has no area that has achieved FSC certification, showing some of the current limitations of the industry," Mr. To Xuan Phuc said.

The reason is that many rubber companies have not paid enough attention to the production of certified rubber, due to limited information sources or enterprises only prioritize export markets that do not require certifications like China.

According to Mrs. Phan Tran Hong Van, Deputy General Secretary of the Vietnam Rubber Association, facing the challenges and requirements of the market VRG has proposed an action plan for the sustainable development of Vietnam's rubber industry, encouraging members to build a sustainable development program.

In addition, the Association has built and developed the certified label "Vietnamese Rubber". Now, 82 products of 29 factories belonging to 17 enterprises have been granted the right to use the "Vietnam Rubber".

However, in order to promote the sustainable development of the rubber industry, Mrs. Van emphasized: "The state needs to create a legal framework to promote and encourage models of sustainable rubber forest management, agro-forestry, environmental protection and aiming to achieve national or international certification.”

Businesses need to develop and implement a sustainable development programme in accordance with national laws and international commitments that Vietnam has signed. At the same time, building linkage models, supporting smallholder rubber farmers to participate in the enterprise's sustainable rubber development program, creating a sustainable rubber source to supply the market, and contributing to building brand and reputation of Vietnam's rubber industry.

By Thanh Nguyễn/Thanh Thuy