Is There a Rubber Shortage? Products Made of the Material Are Hard To Come By

Consumers the world are finding some products difficult to find. Is there a rubber shortage as well?

Anuradha Garg - Author

Mar. 17 2022, Published 11:06 a.m. ET

A latex tree at a rubber plantation
Source: Pixabay

Shortages have become commonplace since the beginning of the COVID-19 pandemic. Is there a rubber shortage as well?

Article continues below advertisement
Article continues below advertisement

A shortage of rubber, a critical raw material in tires, personal protective equipment, and shoes, has had far-reaching consequences. Rubber used in manufacturing can be natural or synthetic, with natural rubber coming from latex tree sap and synthetic rubber coming from oil. Southeast Asia (mostly Thailand) is the largest producer of natural rubber.

In March 2021, the U.S. imported $140 million in raw natural rubber. Rubber hit a 4-year high of $2.40 per kilogram in 2021 and then fell to $1.74 per kilogram in Nov. 2021, reports the World Bank.

Article continues below advertisement

What's to blame for the rubber shortage?

According to the Rubber Authority of Thailand, in 2022, rubber export volumes are expected to rise 2.03 percent year-over-year to about 4.21 million tons. Moreover, tire manufacturers have maintained that it hasn't been difficult to procure raw rubber. What's causing the problem, then?

rubber tire pile
Source: Pixabay
Article continues below advertisement
Article continues below advertisement

Whereas tree disease can impact natural rubber production, it doesn't affect it as much as climate change, shipping container shortages, port congestion, or labor shortages. About 90 percent of natural rubber is produced in Southeast Asia, but it has been difficult to get that out amid container shortages and clogged ports. And now, the Russia-Ukraine war has created more uncertainty. Putin has threatened to nationalize the assets of companies cutting ties with Russia.

Labor shortages are another key culprit

Tire companies world over are finding it harder to get vacancies filled at their production facilities, impacting their operating costs and productivity. According to Goodyear CFO Darren Wells, “When it comes to the labor situation, I think that the challenge in the U.S. has been greater than it has been in other parts of the world.”


Latest Company & Industry Overviews News and Updates

    Opt-out of personalized ads

    © Copyright 2024 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.