Vietnam’s rubber industry has experienced significant growth in recent years, and this trend continues in 2021. According to data from the Ministry of Industry and Trade, Vietnam exported a total of 23,510 tonnes of rubber worth 41.87 million USD to the United States in the first seven months of this year. This represents a substantial increase of 61 percent in volume and an impressive 92.3 percent in value compared to the same period last year. In this blog post, we will delve into the reasons behind Vietnam’s success as a rubber exporter to the US market and explore the potential impact on both countries’ economies.
Vietnam’s Rising Position in the US Rubber Market
Vietnam has significantly improved its position as a supplier of rubber to the United States. In just one year, it has climbed from being the 12th largest supplier to becoming the 11th largest within a period of seven months. Currently, Vietnam accounts for approximately 2.2 percent of all rubber imports by the United States, which is an increase from last year’s figure of 1.5 percent.
This upward trajectory can be attributed to several factors such as increased productivity and efficiency within Vietnam’s rubber industry, favorable trade agreements between both countries, and growing demand for high-quality Vietnamese rubber in various sectors.
Natural Rubber – A Key Export Product
Among all types of rubber exported by Vietnam to the US market, natural rubber is undoubtedly one of its primary export products. In fact, Vietnam ranks fourth among suppliers of natural rubber to the United States with exports amounting to approximately 23,460 tons worth $41.65 million during this period.
The significant growth rate observed for natural rubber exports highlights Vietnam’s commitment to producing high-quality natural rubber that meets international standards. This is a testament to the country’s efforts in improving its rubber processing and manufacturing capabilities.
Overview of the US Rubber Market
To better understand Vietnam’s position as a rubber exporter to the United States, it is essential to have an overview of this growing market. According to statistics from the United States International Trade Commission, the US imported around 1.09 million tons of rubber with a total value of $2.19 billion during this period.
This marks a year-on-year increase of 12 percent in volume and an impressive 27.6 percent in value. The United States relies on several countries for its rubber supply, with Indonesia, Thailand, Canada, South Korea, and Ivory Coast being its largest suppliers.
Factors Driving Vietnam’s Rubber Export Success
Various factors contribute to Vietnam’s success as a rubber exporter to the United States:
a) Enhanced Productivity and Efficiency
Vietnam has made significant strides in improving productivity and efficiency within its rubber industry. This includes adopting modern cultivation techniques, investing in advanced machinery and equipment, and promoting sustainable practices. These efforts have resulted in increased yields and improved quality control measures, making Vietnamese rubber more competitive on the global market.
b) Favorable Trade Agreements
The presence of favorable trade agreements between Vietnam and the United States has also played a crucial role in facilitating bilateral trade growth. The United States continues to be one of Vietnam’s major trading partners, with both countries benefiting from reduced tariffs and streamlined customs procedures.
c) Rising Demand for High-Quality Rubber Products
The global demand for high-quality rubber products has been steadily increasing over recent years. Industries such as automotive manufacturing, construction, electronics, and healthcare heavily rely on rubber materials for their operations. Vietnam’s ability to produce premium-quality natural rubbers that meet international standards has positioned it well to cater to this growing demand.
Economic Impact on Vietnam
The surge in rubber exports to the United States has a positive impact on Vietnam’s economy. The increased volume and value of exports contribute to the country’s GDP growth, create jobs within the rubber industry, and generate foreign exchange earnings.
Moreover, as the demand for Vietnamese rubber continues to rise, it encourages investment in the sector, leading to further technological advancements and capacity expansion. This not only strengthens Vietnam’s position as a key player in the global rubber market but also drives overall economic development.
Vietnam’s remarkable performance as an exporter of rubber to the United States showcases its growing influence in the international rubber industry. The significant increase in both volume and value of exports reflects Vietnam’s commitment to producing high-quality natural rubber that meets global standards.
With favorable trade agreements and rising demand for high-quality rubber products, Vietnam is well-positioned to continue its success as a major supplier of rubber to the United States. This not only benefits Vietnam’s economy but also deepens bilateral trade relations between both countries.