Highlights
 

•  In Q1 2025, Cambodia exports 59,754 tons of rubber, down 13.8% YoY
   

• Overall rubber production in Q1 2025, 64,080 tons, down 7.9% YoY
   
• Trump tariff, EUDR pose challenge to Cambodian rubber and tire
   

A surge in domestic tire manufacturing, mainly targeted at the export market, is reshaping Cambodia’s rubber economy, but stagnant rubber production threatens to expose a critical supply gap that could undermine the sector’s ability to meet growing domestic demand. Rubber export volumes are already feeling the squeeze, and without swift expansion of plantation coverage, domestic shortages could derail industrial momentum and strain the country’s emerging profile in the rubber value chain.

Kingdom earns US$116 million from exports in Q1 2025, up 15% YoY

In the first quarter of 2025, ended March 31, Cambodia exported 59,754 tonnes of rubber, down 13.8% year-on-year. However, the returns registered better performance on account of better rubber values. The kingdom earned US$116 million from rubber latex and wood exports in the quarter, up 15% YoY, the General Directorate of Rubber (GDR) reported. Rubber latex exports were valued at US$114.93 million. Cambodia primarily exports latex to Malaysia, Vietnam, Singapore, and China.

The overall rubber production in the quarter was 64,080 tons, down 7.9% YoY. Khun Kakada, Acting Director-General of the GDR said the average selling price of rubber in Q1 2025 was US$1,923 per ton, up US$474 per ton, or 32.7% YoY.

Cambodia is reporting increasing demand for its rubber latex from Chinese tire manufacturing companies who have pitched tents in Cambodia in recent years. Experts feel that rubber exports may be halved without much delay if the domestic tire companies undertake production at full capacity. This, however, may be offset by larger tire exports.

Sailun alone will need 100,000 tons in 2025

Sailun Tire Cambodia which has branched out from China alone estimates that it will need 100,000 tons of rubber for its tire production in 2025. It purchased 60,000 tons in 2024, up from 30,000 tons in 2023. Currently, it imports rubber in addition to the local supply, which is in deficit. Its local supply sometimes does not meet the required standards, either. The General Directorate of Rubber Cambodia is now stepping into the realm to foster Good Agricultural Practices among Cambodian rubber farmers to ensure the supply of quality rubber to tire firms, so that the farmers can also snatch higher prices.

Sailun invested $93.5 million last year to expand production at its facility in Qilu Special Economic Zone in Svay Rieng Province.  Sailun’s facility has spread to over 120 hectares since launch four years ago, investing US$1 billion. Its exports are estimated at 25 million tires for trucks, passenger vehicles and off-the-road vehicles.  

Cambodia currently has three full-fledged tire plants: Newbustar (Cambodia) Tire Co Ltd at Kratie, General Tires Technology (Cambodia) Co Ltd at Preah Sihanouk, and Cart Tire Co Ltd at Svay Rieng province, all Chinese-owned firms. Sailun controls Cart Tire. Four more tire firms are at various stages of establishment. All of these will require rubber in bulk quantities in the coming days.

Tire firms keeping fingers crossed

However, since Trump has cast a shadow over exports to the US with his tariff escalation, the Chinese tire companies that have set up production units in Cambodia are keeping their fingers crossed. Their only solace now is that they are on an equal footing with other nations, while their Chinese bases face the much higher tariffs imposed by Trump on exports from China. The Chinese firms in recent times branched out to ASEAN countries as it became more and more evident that the exports from China would face harsher tariffs from the US and European Union.

Cambodian rubber and tire exporters will face the sustainability challenge in the EU market, with EUDR coming into force at the beginning of next year. So the two major markets pose challenges for the Cambodian rubber and tire sectors, and the companies and authorities have to gear up to overcome the challenges. Already, the ANRPC has called upon private firms to handhold the rubber smallholders for geo-mapping and other aspects for EUDR compliance, which has become the need of the downstream operators as well to ensure due diligence certificates for EUDR compliance.

Natural rubber is also in greater demand for tires of heavier EVs, and Cambodian authorities are now feeling an urgency to expand their rubber plantations and utilize the unutilized plantations as well. Unutilized rubber plantations account for over 47,000 hectares, or about 11% of the total, which comes to 425,443 hectares, with over 330,200 hectares — approximately 78% — currently having tappable trees. Plants on around 48,000 hectares are in the gestation period.

Of the total plantation area, rubber trees grown under economic land concessions cover 176,121 hectares (41%), while family-owned rubber plantations make up 202,321 hectares (48%).

In 2024, Cambodia’s export of rubber latex and rubberwood fetched US$671.68 million for the country, marking a 36.48% rise year-on-year. The earnings from rubber latex exports alone came to US$666.25 million. The country exported 338,000 tons of rubber latex during 2024, representing a decline of 30,048 tons, or 8.16%, YoY. The challenge before the authorities is to arrest this decline and then enhance production.