Firestone to stop rubber purchasing for 2 weeks due to oversupply

August 8, 2017

FirestoneFirestone Natural Rubber Company, LLC, a subsidiary of American tyre and rubber company Firestone, is suspending rubber purchasing for two weeks from August 10 to August 24 “due to the current extreme oversupply of our rubber inventory”.

Firestone Natural Rubber Company, LLCoperates the largest contiguous rubber plantation in the world in Liberia.

The company however pledged to make every effort to minimise this interruption and will endeavor to resume purchasing before August 25, if possible.

Smallholder farmers in Liberia depend on the regular purchase of their rubber inventory — their main source of income — by Firestone, which in turn exports the commodity in bulk to customers abroad.

However, given the consistent decline in the price of the commodity globally and the lack of functioning value-adding facilities for natural rubber in Liberia, the measure by Firestone renders a hiccup in the already fragile industry, especially local farmers at the bottom of the value chain.

J. B. Sackie, a rubber farmer in Salala District, Bong County said that the decision would greatly affect many smallholder rubber farmers, if the announced schedule elapses. While it is true that rubber farmers will be out of business within the next two weeks, the decision to stop rubber purchases from smallholder farmers means some level of economic hardship for rubber farmers.

“Many farmers, especially those in Salala District, depend solely on the rubber business for the support of their families. We do not have any option for the sale of rubber and will appreciate if Firestone would resume rubber purchase very soon,” he stated.

In the announcement, Firestone noted: “We understand the inconvenience and disruption this action may cause our valued farmers. However, due to the current space constraints in our factory, we have no other options,” the Firestone announcement said. “We appreciate your patience and understanding during this time.”

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International Rubber Prices
(as of 21, September 2017)

Monthly The prices shown above do not include VAT @4% on purchase and expenses towards packing, transportation, warehousing  and other incidentals


Source: India Rubber Board

Automotive

PRA ELECTRONIC ISSUE 2017
September 2017 Issue

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