Project with German Federal Ministry for Economic Cooperation and Development for digital traceability of natural rubber in Indonesia is being expanded
Number of small farmers involved to be expanded from 450 to 4,000 by 2024
Digitization of the entire supply chain enables full traceability
“Education and digitalization are important contributors to making our supply chains sustainable,” says Claus Petschick, Head of Sustainability of the Tires business area
FORT MILL, S.C. – May 11, 2021. Continental, one of the largest tire and automotive technology suppliers in the world, is extending its commitment to sustainability in the natural rubber supply chain. The premium tire manufacturer and the German Federal Ministry for Economic Cooperation and Development (BMZ) have agreed on a significant expansion of their successful project to ensure full traceability of the natural rubber supply chain in the Indonesian province of West Kalimantan in Borneo. The project has been expanded from the original group of 450 small farmers to 4,000 by 2024. The project objective remains the same: Small farmers in the natural rubber sector are trained to grow high-quality raw materials in compliance with clearly defined sustainability criteria. By improving the quality of the raw material, the income of the farmers will be increased.
“Continental’s goal is to achieve 100 percent sustainable supply chains by 2050. The valuable experience we are gaining in this project allows us to progressively increase the transparency of our natural rubber supply chains,” says Claus Petschick, Head of Sustainability of the Tires business area. He adds, “Education and digitalization are important contributors to making our supply chains more sustainable. Together with our partners, we are demonstrating in Borneo that this can succeed in the natural rubber sector. I am pleased that we are now significantly expanding this successful project.” Indonesia is one of the world’s largest producers of natural rubber. The Kapuas Hulu district, where Continental is collaborating with the BMZ, has two national parks that have been designated as biosphere reserves by UNESCO.
Continental and the BMZ already implemented a digital traceability system for natural rubber in the project region back in 2018. With its help, all steps of the natural rubber supply chain can be evaluated in detail - from cultivation to further processing to Continental's tire plants. The cultivation areas mapped by GPS, raw rubber delivery quantities and sales prices achieved are documented in the system for each transaction. For the further processing of the raw rubber produced in the project and in the implementation of the traceability, the project partners work in particular with the natural rubber suppliers Southland Global and Halcyon Agri Corporation.
Sustainable and responsible business practices have already been an integral part of Continental’s corporate strategy for many years and also an important part of the “Vision 2030” strategy program for the Tires business area. The tire manufacturer aims to differentiate itself specifically with sustainable technologies and innovative solutions. The focus here is on the strategic topics of climate action, low-emission mobility, the circular economy and sustainable supply chains and therefore all phases along the value chain. The company’s “Natural Rubber Sourcing Policy” defines clear responsibilities and commitments for Continental as well as all of its suppliers and service providers along the entire natural rubber value chain. The aim is to minimize environmental, human-rights and social risks.
Both the BMZ and Continental are members of the Global Platform for Sustainable Natural Rubber (GPSNR), which was founded in March 2019, a merger of the most important players in the natural rubber sector from the economy and civil society. Together with other members, they are working on the global improvement of sustainability in the natural rubber sector. Both Continental and the BMZ aim to promptly take into account the guidelines for greater sustainability in the natural rubber sector elaborated here in their projects in Indonesia.
Continental develops pioneering technologies to make commercial fleets safer, more efficient, and more connected. With innovative tire technology and digital fleet solutions, Continental optimizes tire lifecycle management to deliver the Lowest Overall Driving Cost to fleets and become the preferred partner to our independent tire dealers. Continental is currently one of the five largest brands in medium/heavy truck tires in the U.S. by market share.
Continental develops pioneering technologies and services for sustainable and connected mobility of people and their goods. Founded in 1871, the technology company offers safe, efficient, intelligent, and affordable solutions for vehicles, machines, traffic and transportation. Continental generated sales of €37.7 billion in 2020 and currently employs around 235,000 people in 58 countries and markets. In 2021, the company celebrates its 150th anniversary.
The Tires business area has 24 production and development locations worldwide. Continental is one of the leading tire manufacturers with more than 56,000 employees and posted preliminary sales of €10.2 billion in 2020 in this business area. Continental ranks among the technology leaders in tire production and offers a broad product range for passenger cars, commercial and special-purpose vehicles as well as two-wheelers. Through continuous investment in research and development, Continental makes a major contribution to safe, cost effective and ecologically efficient mobility. The portfolio of the Tires business area includes services for the tire trade and fleet applications, as well as digital management systems for tires.
Continental develops pioneering technologies to make commercial transport safer, more efficient and more connected. The company’s products and services deliver measurable impact for commercial vehicle manufacturers and the aftermarket. They benefit from a broad portfolio and from fully integrated systems. The portfolio includes tires, digital tire monitoring, fleet management, telematic solutions, Electronic Logging Devices (ELD) and tachographs, hoses, air springs, Electronic Control Units (ECU), displays, drivetrain and exhaust aftertreatment systems, sensors, advanced driving assistance systems, as well as eHorizon maps and events and cloud-based services. In 2017, the share of Continental’s global sales for commercial vehicle products and systems was around €4.7 billion.