Challenges of the Export for Natural Rubber Latex in the ASEAN Market

There are approximately 90% of the world natural rubber (NR) supplies are produced by the top 4 NR exporting countries, particularly Thailand, Indonesia, Malaysia and Vietnam. The export challenges and uncertainties of the NR latex in the ASEAN market are influenced by many factors. All these issues have driven the motivation of this study that aims to investigate the factors affecting the export of the NR latex, to analyse the relationship among the export price, production and exchange rate with the export, and to predict the export of the NR latex of the four countries. The data from 1999 to 2016 are utilized as the panel data analysis and granger homogeneously causality test for estimations. Estimation reveals that the independent variables, namely export price and production are exhibiting significant positively and the exchange rate shows a negative relationship with export. To conclude, Indonesia and Malaysia are estimated to have decreasing trends of NR latex export. Inversely, Thailand and Vietnam are predicted to exhibit increasing trends of NR latex export. The novelty of this study concerns effectively on the enhancement and stability of NR production in the ASEAN markets despite of the challenges arising from the global market integration.