Sumitomo Rubber Industries, Ltd has announced that the company has set up a new subsidiary for the procurement of natural rubber. Called Sumitomo Rubber Singapore Pte. Ltd, the new company will be based in Singapore, which is the largest hub in the world for trade in natural rubber. The tire manufacturer set up the new company with the goal of ensuring a more stable supply of high-quality natural rubber in order to cater to its requirements.
Earlier, the sourcing of natural rubber was handled by the Natural Rubber Division of the company’s tire sales subsidiary in Singapore, Sumitomo Rubber Asia (Tyre) Pte. Ltd. When the new company begins its operations in April 2020, it will take over procurement activities from Sumitomo Rubber Asia (Tyre) Pte. Ltd and will also deal with other outward-looking efforts related to natural rubber and its procurement.
Though the demand for natural rubber has increased in recent years, it is anticipated that the output of natural rubber in the main rubber producing countries in Asia will decline in the near future. There is growing concern about sustainability with regard to the supply of natural rubber, price fluctuations and mergers, market withdrawals within the natural rubber industry which can lead to monopolies as well as other potential issues in various markets.
All these factors called for a global approach to the procurement of natural rubber and the need for a procurement system helmed by a locally based organization that would deal with procurement activities for high-quality rubber and outward-looking efforts like GPSNR, the Global Platform for Sustainable Natural Rubber. GPNSR is an organization that serves as an umbrella for the various stakeholders involved in natural rubber, including the suppliers of natural rubber, tire manufacturers, vehicle manufacturers, NGOs and others. Sumitomo Rubber Group is one of the founder members of GPNSR which was establish in light of the potential for human rights abuses, deforestation and other problems that may arise in the process of producing natural rubber coming under sharper scrutiny from the viewpoint of Sustainable Development Goals (SDGs), there is a now a greater demand for considerations from the perspective of human rights and the environment in the procurement process toward realizing sustainable procurement of natural rubber. In order to address these issues, GPSNR was launched in October of 2018 and, as a founding member, the Sumitomo Rubber Group has since been actively engaged in activities that aim to ensure a sustainable future for natural rubber.
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