Firestone Liberia LLC Tuesday announced an indefinite freeze on the purchasing of rubber from local farmers across the West African nation as it protests government’s intervention in the market that has push buying price upward by 15.27%.
Liberia National Rubber Pricing Committee for the first time sets the buying price of the commodity at $574.06 per tons of cup lumps or slaps, aiming to protect smallholder farmers and regulate the industry.
Monthly pricing is based on the average daily price of rubber on the Singapore Commodity Exchange for each proceeding month, the Committee said.
“This pricing structure reflects our commitment to a transparent, fair, and farmer-centered rubber economy.”
Firestone, a subsidiary of Bridgestone Americas said Tuesday it was temporarily suspending rubber purchase because the price was
higher than its buying price. It pays farmers $498 per tons of cup lumps as at June 1. According to Firestone in an average year, it purchases over 60 million pounds of Natural Rubber from smallholder farmers, providing them with an income exceeding US$ 30 million.
The company said concession agreement reached with Liberian authorities gave it the right determine price based on international market conditions.
“The price set by the Committee is not based on any objective standard because rubber processors across Liberia operate under diverse conditions and some, including Firestone, are bound by existing social obligations, including education, housing, medical, community development commitments, support for smallholder farmers, and infrastructure maintenance.
“These obligations impose significant incremental costs that a uniform pricing model does not consider. The price announced by the Committee today does not take into consideration the various factors stated above and therefore is not sustainable.”
Jetty Rubber LLC , one of the leading processors said it would comply with the new price structure. “We see the pricing fair and we are applying it as indicated,” Upjit Singh Sachdeva who owns the erstwhile Salala Rubber Corp, renamed Jeety Rubber. The Liberia Agriculture Company has not commented on the pricing structure.
Firestone said it will continue talks with the Committee to formulate a national price applicable to all processors and farmers to ensure a consistent and viable supply of rubber
There are estimated 60,000 Smallholder farmers who contribute to processed and exported rubber. Rubber is one of Liberia’s major exports, accounting for an estimated 33.5 percent of export proceeds in 2024, according to the Ministry of Agriculture.
Output expanded by 10.4 percent to 22,780 metric tons at end -December 2024, from 20,642 metric tons produced in the third quarter of 2024. The rise in the production of the commodity was driven by increased production from smallholder farmers, the Central Bank of Liberia said in a report published on its website.
