Is a ‘Rubber Apocalypse’ Threatening Transportation?

Rubber. It’s in so many things that we take for granted: water bottles, spatulas, erasers, grip handles, video game controllers, safety gloves, conveyor belts, waistbands, condoms, and, of course, rubber bands. The critical raw material is produced through the extraction of latex from the rubber tree by tapping the bark with incisions and collecting the fluid. The liquid latex then undergoes coagulation processes and is processed into dry forms for sale to the many industries that use the raw commodity to make various goods. A vast majority of the world’s rubber, well over 90%, comes from smallholder plantations in Southeast Asia. Thailand is the largest producer, followed by Indonesia and Vietnam. There is also significant rubber production in India, China, and Malaysia.

Aside from its range of uses from household items to essential healthcare supplies, for the global economy, rubber is absolutely crucial in transportation. While synthetic rubbers are used in part for some ordinary tires, upwards of 70% of all rubber produced goes into the manufacture of tires for the many vehicles that rely on them to traverse distances, especially for heavy-duty trucking and aircraft. Most of the time, this use for rubber is also seemingly overlooked by the average person. It’s long been a given that the conveniences of air and overland transportation made possible with rubber tires will continue indefinitely. But some are recognizing the danger of a global reliance on this one natural resource from one region, especially for the purpose of transportation that has become so ingrained in the economic ecosystem in almost every populated corner of the world.

How different would modern life be in the absence of this miraculous feat that is transportation? Yes, without sufficient rubber, transportation by car, plane, truck, and even bicycle would be entirely impossible. That means that there would be serious questions of how to move all imaginable goods (including the tens of thousands of goods made from rubber), as well as people as they go about their travels for work, leisure, and everyday tasks. The globalized economy relies upon the recently strained network of container ships to move massive amounts of cargo across oceans as countries import and export products; but on land, the transport of goods relies on trains that move along railroads and automobiles that move along roads and highways with the use of rubber tires.

Large freight trucks move containers filled with pallets of goods to warehouses that sell to distributors. Shipping vehicles transport goods to wholesalers and retail stores for sale to consumers. The consumer must also take a ride to get to the store in order to purchase the goods they desire and transport them back. With the rise of delivery services for products online, such as with Amazon shipping, goods have been increasingly sent directly to the end consumer by parcel service, with smaller-sized vehicles on local roads. Even fresh groceries can be delivered directly on the same day. This change has coincided with the rapid increase of food delivery apps and other services that make ordering food from a variety of restaurants a matter of a few taps on a phone screen. This process is localized in a way such that transportation can be done by car, bike, motorbike, and even by foot—all of which require rubber to meet the road.

This capacity for virtually any imaginable consumer product to be delivered across oceans and continents to your local store or right to your door may be in a precarious position. In recent years, both flooding and diseases that affect rubber trees have been a major concern for farmers due to the seven-year-long maturity rate required to grow a productive plant. With the time it takes to grow rubber trees, as well as fluctuations in global supply and demand, farmers face a high degree of volatility in determining their plans for cultivation and loss-prevention. The past year has seen both disruption to the world’s supply chains as a whole as well as a sharp rise in the demand of delivery services, which consequently increased the demand of rubber tires. There has even been an observed increase during the pandemic in the demand for bicycles, which also require rubber tires and tubes.

At this point in time, industry leaders like Goodyear Tire & Rubber insist that their supply chains are ready for continued production into the future. However, the whispers of a ‘rubber apocalypse’ should give way for more preparation around this valuable material. There are already efforts underway to find natural alternatives to the traditional rubber tree, such as Bridgestone’s recent tests with the desert shrub guayule or Fraunhofer Society’s research into deriving rubber from dandelions. Perhaps a global diversification of this invaluable commodity will be the next step in ensuring that rubber tires can be produced reliably and sustainably so that economic activity keeps on rolling well into the future.


  • Weimin Chen

    Weimin Chen has been a research assistant and contributor at the Austrian Economics Center. His work has also been featured at the Mises Institute, Antiwar.com, and the Scott Horton Show.

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The views expressed on austriancenter.com are not necessarily those of the Austrian Economics Center.

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