The Department of Agriculture (DA) said rubber farmers will start producing local motorcycle tires in the first quarter of 2019 as part of a government program that seeks to improve their income.
Agriculture Secretary Emmanuel F. Piñol said the Philippine Rubber Farmers’ Association (PRFA) will partner with Leo Tire Manufacturing Corp. (LTMC) for the manufacture of raw rubber into motorcycle and small tractor tires.
The production of the tires, which would be branded as “Pilipinas Agila Tires,” may kick off by February, according to Piñol.
“The rubber farmers themselves will market the tires made out of their farm produce to motorcycle owners and hand-held farm tractors to manufacturers and farmers,” he said in a Facebook post on Thursday.
“This will virtually free the rubber farmers from the control of traders who base their buying prices for raw rubber called cup lumps on world market prices which are low now,” Piñol added.
He said the deal was reached on November 7 after the Bulacan-based LTMC agreed to a “tolling arrangement.” The company would process the farmers’ semi-processed rubber, dubbed as “SPR 20,” into motorcycle and hand-held tractor tires.
Also under the deal, the PRFA would be converted into a farmers’ cooperative that would purchase all the rubber of their members and process these into SPR 20, according to Piñol.
The SPR 20 would be sold by the PRFA to LTMC and would process this into tires. The tires would be sold back to PRFA at factory prices, Piñol said. The group would then sell the tires to motorcycle owners and fabricators of hand-held tractors.
Citing Lim, Piñol said the mold for the Pilipinas Agila Tires would be available by January 2019.
“The DA will provide technical and financial support to the PRFA to implement this project,” he said.
“It was Lim himself who recommended that the PRFA first focus on the two products—motorcycle tires and hand-held tractor tires—because these are the fast-moving products in his company’s experience,” he added.
Piñol said processing farmers’ raw rubber into high-value products, such as tires, is the solution to stop traders and middlemen from manipulating the price of rubber cup lumps.
“From a high of P100 per kilo about 10 years ago, prices of raw rubber have dropped to only P25 per kilo today, prompting many farmers to cut down their rubber trees and shift to other crops,” he said.
Image credits: Leonardo Perante II