structural:expansion, structural:reformatting, quality:corruption
Rubber shortage and global economics

There is growing concern for the future supply of rubber due to various factors, including plant disease, climate change, and the volatile market price of rubber. Producers of natural rubber are mostly small family-held plantations, often serving large industrial aggregators. High volatility in the price of rubber affects rubber plantation investment, and farmers may remove their rubber trees if the international market spot price of a seemingly more profitable crop (for example palm oil) surges in relation to rubber.

For instance, during the 2020 and 2021 international COVID-19 pandemic, demand for rubber gloves surged, leading to a spike in rubber prices of about 30%. In addition to the pandemic, demand exceeded supply in part because long term plantations had been torn out and replaced with other crops over the previous 5–10 years, and other areas were affected by climate-fueled natural disasters. In this environment, producers did increase their prices in keeping with supply and demand dynamics, putting upward price pressure on the whole downstream supply chain.