A Chinese company signed a contract in Haikou Friday with a Cambodian
counterpart to plant rubber in the southeast Asian nation, the first such move
to increase China's self-supply capacity of the valuable industrial material.
According to the agreement signed between Hainan Natural Rubber Industry
Group Corp. and Suigang Investment Development Co. Ltd. of Cambodia, the Chinese
firm will be able to grow natural rubber, establish rubber and wood processing
plants on a land of 62,659 hectares in Cambodia, and operate rubber trade.
"We will adopt the latest industrial standards in the project, taking
advantage of Cambodia's abundant natural resources," said Wu Yarong, chairman of
the board with the Hainan-based company, China's largest rubber producer.
With over 250,000 hectares of cropland, the company produces 250,000 tons of
natural rubber every year, which accounts for about a half of China's total
output.
"The cooperation project will help improve the living standards of Cambodian
people," said Sim Sonthim, chairman of the board with Suigang.
China has become the world's largest rubber consumer and importer since 2001.
The national consumption hit 2.04 million tons last year, however, the annual
output capacity was some 500,000 tons.
Facing the mere 600,000 hectares of arable land of rubber mainly located in
Hainan, Yunnan and part of Guangdong provinces in southern China with abundant
rainfall, Chinese rubber producers are focusing their eyesight on African and
southeast Asian regions where huge favorable land resources are still left
unused.
Rubber expert Jiang Jusheng said the cooperation with the Cambodian company
marks the turning point of Chinese enterprises' pursuit of a new development
mode for rubber industry to practice.
The Hainan-based rubber company also plans to invest 1.3 billion yuan (162.5
million U.S. dollars) in the establishment of a rubber processing factory with
an annual output capacity of 300,000 tons and a rubber trade firm in southeast
Asia by 2010, and acquire the right of using 140,000 hectares of land in African
and Southeast Asian nations, said Wu.
Another Chinese rubber giant Yunnan Natural Rubber Group Ltd. also aims at
planting over 3,000 hectares of rubber in a demonstration project in Myanmar by
2010, preparing for the expansion of 30,000 hectares.
Chinese rubber producers are stung by soaring price, which has rocketed to a
maximum of 22,000 yuan (2,750 U.S. dollars) per ton in the world rubber market
from nearly 6,000 yuan (750 U.S. dollars) five years ago, according to Jiang.
China's automobile industry will require some 716,000 tons of rubber in 2010
and 1.63 million tons ten years later, according to Chinese Academy of
Automobile Engineering.
Prompted by the strong desire to seek overseas development, Chinese rubber
firms are suffering from some business problems like transportation
inconvenience and dual taxation both at home and abroad.
Chinese rubber producers are calling for more government support for their
bold efforts in exploring foreign market to achieve a "win-win" situation, which
in the end will boost rubber supply to domestic market.