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In 2024, it was estimated that Indonesia produced around **** million metric tons of rubber. Indonesia is the world’s second-largest producer of rubber and a part of the International Tripartite Rubber Council, together with Thailand and Malaysia. Having an essential role in the world rubber trade, it is no wonder that the rubber industry contributes an important role to Indonesia’s GDP.

Primary rubber producers in Indonesia

More than ** percent of the rubber producers in Indonesia are smallholders and over **** million farmers and farmworkers are employed in the rubber sector. Indonesia’s oldest and primary production areas for rubber are located on Sumatra and Kalimantan Island. It was first introduced to Indonesia during the Dutch colonialization at beginning of the 20th century, following the increasing demand for rubber for tires in the motor vehicle industries, natural rubber shortly became one of the most important commodities in Indonesia.

Indonesia’s rubber industry is dependent on exports

Despite its high production, the productivity and absorption of rubber production in the country are relatively low. Most of the rubber production in Indonesia is exported to other countries, such as the United States, Japan, and China. A lack of a downstream industry made Indonesia’s rubber industry heavily dependent on export markets.