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Helixtap

Helixtap collects, processes and distributes proprietary data, analyses and forecasts for the rubber, latex and automotive markets

Head of Content, Data & Research, Helixtap

Arusha Das

Head of Content, Data & Research

Commodities

<ul><li>PT Wipolimex Raya, a mid-sized rubber producer in Indonesia, acquires the New Fountain factory of P&P Bangkinang(SCQ) at US$3.5 million, on September 15, 2021.This acquisition would increase Wipolimex’s annual capacity to 46,000/mt from 30,000 /mt, according to Helixtap’s data.  As per Helixtap’s data, the super-prime New Fountain factory of P&P Bangkinang(SCQ) had an annual capacity of 16,000/mt and used to ship out its products from Belawan.</li><li>Thus, the acquisition would strengthen Wipolimex’s position in the hub. This is an interesting turn of events given the current market situation wherein the small factories are struggling with squeezing margins amid sluggish demand. “I heard there are a few producers also offering to sell their factories,” said an Indonesia-based producer source.  On one hand, this would mean there is a possibility of consolidation happening in the Indonesian rubber industry which would strengthen the sustainability efforts in the rubber supply chain. On the other hand, there is also the threat of lack of diversity in Indonesian rubber production which could lead to a monopoly in the industry. Earlier in 2018 in a similar move, Halcyon Agri Corporation Limited acquired four Standard Indonesia Rubber (SIR) factories owned by producers PT Sumber Djantin and PT Sumber Alam to position itself as one of the largest SIR exporters. STRUGGLING SMALLHOLDERSLots of small rubber producers in Indonesia are incurring losses and some of them are willing to sell their utilities, as per various producer sources.“P&P Bangkinang(SCQ) was incurring losses for past 2-3 years”, said the Indonesian producer source.The rubber is not directly processed in Indonesia, unlike countries like Vietnam.</li><li>This results in better quality in terms of pri and pro level, but it considerably increases the cost of production for the Indonesian producers compared to other rubber producing countries, said another Indonesian producing source.Moreover, the producers are struggling with a plethora of issues like manpower shortage, pandemic-driven disruption coupled with uncertain rains, shipping issues, and see-sawing demand.</li></ul>

PT Wipolimex Raya, a mid-sized rubber producer in Indonesia, acquires the New Fountain factory of P&P Bangkinang(SCQ) at US$3.5 million, on September 15, 2021.This acquisition would increase Wipolimex’s annual capacity to 46,000/mt from 30,000 /mt, according to Helixtap’s data.  As per Helixtap’s data, the super-prime New Fountain factory of P&P Bangkinang(SCQ) had an annual capacity of 16,000/mt and used to ship out its products from Belawan.Thus, the acquisition would strengthen Wipolimex’s position in the hub. This is an interesting turn of events given the current market situation wherein the small factories are struggling with squeezing margins amid sluggish demand. “I heard there are a few producers also offering to sell their factories,” said an Indonesia-based producer source.  On one hand, this would mean there is a possibility of consolidation happening in the Indonesian rubber industry which would strengthen the sustainability efforts in the rubber supply chain. On the other hand, there is also the threat of lack of diversity in Indonesian rubber production which could lead to a monopoly in the industry. Earlier in 2018 in a similar move, Halcyon Agri Corporation Limited acquired four Standard Indonesia Rubber (SIR) factories owned by producers PT Sumber Djantin and PT Sumber Alam to position itself as one of the largest SIR exporters. STRUGGLING SMALLHOLDERSLots of small rubber producers in Indonesia are incurring losses and some of them are willing to sell their utilities, as per various producer sources.“P&P Bangkinang(SCQ) was incurring losses for past 2-3 years”, said the Indonesian producer source.The rubber is not directly processed in Indonesia, unlike countries like Vietnam.This results in better quality in terms of pri and pro level, but it considerably increases the cost of production for the Indonesian producers compared to other rubber producing countries, said another Indonesian producing source.Moreover, the producers are struggling with a plethora of issues like manpower shortage, pandemic-driven disruption coupled with uncertain rains, shipping issues, and see-sawing demand.

Wipolimex Buys Bangkinang’s Factory At US$3.5 Million

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Wipolimex Buys Bangkinang’s Factory At US$3.5 Million