DTI Commits Support to Yokohama Tire for 100% Local Rubber Sourcing in Philippines Expansion
Manila, Philippines — The Department of Trade and Industry (DTI) has pledged to support the Yokohama Rubber Company Ltd. in achieving full local sourcing of rubber for its Philippine operations as part of an expansion plan that includes a substantial increase in production capacity.
According to Philippines News Agency, during a recent briefing with trade reporters, the department is committed to assisting Yokohama Tire Philippines, Inc. (YTPI), the local unit of the Japanese tire manufacturer, in boosting its local rubber sourcing from the current 51% to a full 100%. This announcement followed Pascual’s discussions with company executives in Tokyo during the Philippine Economic Briefing held from June 19 to 21.
Yokohama is planning to invest approximately USD 60 million (PHP 3.5 billion) to increase its production by 5%, which translates to an additional 500,000 tires annually, on top of the current output of 10 million tires per year. However, Pascual highlighted a significant challenge in the local sourcing of natural rubber, noting that current local suppliers are unable to fully meet Yokohama’s demand.
To address this issue, the DTI is set to collaborate with the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) to potentially increase the supply of raw rubber to YTPI. Pascual revealed that YTPI currently sources about 12,000 metric tons of raw rubber valued at nearly PHP 1 billion from the Philippines, with the potential to supply an additional 30,000 metric tons.
The DTI chief emphasized the economic benefits of increasing local rubber sourcing, estimating that it could generate another billion pesos in revenue for farmers in Mindanao. He also expressed confidence in the country’s ability to meet the Japanese tire producer’s needs, citing Philippine Statistics Authority data that reported rubber production in the second quarter of 2023 stood at 112,590 metric tons, with BARMM contributing 43,150 metric tons, or 38.3% of the total.