Block Skim Rubber Gains Momentum: How Much Does It Really Influence Global Rubber Prices?
Medan, August 26, 2026 – Amid the strong performance of global natural rubber prices throughout 2026, industry participants are once again turning their attention to the growing production of Block Skim Rubber (BSR), a rubber product derived from skim latex, the by-product of latex concentrate processing.
Over the past several years, Block Skim Rubber production has expanded in major producing countries such as Thailand and Malaysia, in line with the development of the latex concentrate industry. This has raised questions within the rubber sector as to whether the additional supply of Block Skim Rubber is significant enough to influence global benchmark prices, particularly TSR20 (Technically Specified Rubber 20) and RSS3 (Ribbed Smoked Sheet Grade 3).
So far, most market participants believe its impact on global prices remains relatively limited.
Adding Value to a By-product
During the production of latex concentrate, most of the rubber content is separated through centrifugation to produce the primary raw material used in manufacturing gloves, elastic threads, condoms, balloons, and various dipped rubber products.
After the process is completed, however, some rubber remains in the residual liquid known as skim latex. Through coagulation, drying, and further processing, this skim latex is converted into Block Skim Rubber, transforming what was once considered a low-value by-product into a commercially valuable product. Typically, skim latex still contains around 4–8% dry rubber content, which can be recovered and processed into solid rubber products.
Gaining Momentum After the Pandemic
Although Block Skim Rubber has existed in the natural rubber industry for decades, its production began expanding more rapidly during 2021–2022, when the global glove industry experienced unprecedented demand during the COVID-19 pandemic.
The sharp increase in latex concentrate production in Thailand, Malaysia, Vietnam, and parts of Indonesia automatically generated larger volumes of skim latex. At the same time, processors invested in improved recovery technologies to maximize rubber extraction from skim latex, allowing them to utilize virtually every part of the raw material.
Besides generating additional revenue, recovering skim latex has also improved production efficiency and reduced industrial waste, supporting the rubber industry's transition toward a circular economy.
Driven by Efficiency Rather Than Demand
Unlike primary rubber products that are produced specifically to meet market demand, the growth in Block Skim Rubber production has largely been driven by manufacturers' efforts to maximize the utilization of by-products.
Advances in processing technology now enable producers to recover rubber that previously would have been discarded with skim latex, creating additional value with relatively modest investment.
Consequently, the expansion of Block Skim Rubber production reflects improved processing efficiency rather than a surge in dedicated market demand for the product itself.
Does It Affect TSR20 and RSS3 Prices?
In theory, increasing Block Skim Rubber production does add to the global supply of natural rubber. However, industry analysts generally agree that its influence on benchmark prices such as TSR20 and RSS3 remains relatively minor.
The total volume of Block Skim Rubber is still small compared with overall global natural rubber production. Moreover, it is primarily used in applications where premium-quality rubber is not required or as a blending material in rubber compound formulations.
By contrast, benchmark rubber prices continue to be driven mainly by much larger market fundamentals, including:
Natural rubber production in Thailand, Indonesia, Vietnam, and Malaysia;
Weather conditions, particularly the impacts of El Niño and La Niña;
Global tire industry demand, which accounts for approximately 70% of worldwide natural rubber consumption;
Rubber inventory levels in China;
Crude oil prices, which influence the competitiveness of synthetic rubber; and
Trading activities on major futures exchanges, including SGX (SICOM), SHFE, and OSE.
As a result, the additional supply from Block Skim Rubber has not been sufficient to materially alter the direction of global rubber prices.
The Industry Now Faces New Challenges
Ironically, while Block Skim Rubber production has become increasingly efficient, the latex concentrate industry itself is facing mounting challenges.
In Indonesia, particularly in North Sumatra, several latex concentrate processing plants have begun ceasing operations due to growing difficulties in securing fresh field latex. Large areas of rubber plantations have been converted to oil palm cultivation, reducing the availability of raw materials.
At the same time, demand for latex concentrate from the glove manufacturing sector has declined as some producers increasingly substitute synthetic latex for certain product categories.
Should this trend continue, Block Skim Rubber production is also expected to decline, as reduced latex concentrate output will inevitably result in lower volumes of skim latex available for recovery.
Outlook
Over the longer term, Block Skim Rubber is expected to remain an important component of operational efficiency in the latex concentrate processing industry. Converting by-products into marketable products provides processors with additional revenue while reducing production waste.
However, from the perspective of the global natural rubber market, Block Skim Rubber is likely to remain a supplementary source of supply rather than a major price driver. Benchmark prices such as TSR20 and RSS3 will continue to be influenced primarily by production trends in key producing countries, weather conditions, Chinese inventory levels, global tire demand, and broader macroeconomic developments, rather than by changes in Block Skim Rubber production alone.