This Giant Beast That is the Global Economy (2019) s01e03 Episode Script
The Rubber Episode
1
Gee-whiz.
When I was a kid,
I was pretty sure
I knew how the world
was going to end,
alien invasion,
giant lizard attack,
or zombie apocalypse.
And even though some
people are still convinced
that Godzilla, flying saucers
and the body snatchers
are on the way.
Today, there's a more
immediate apocalyptic threat,
the potential disappearance
of a crucial global commodity
we rely on in ways we
don't even realise,
one specific commodity that's
so important, so ubiquitous,
nearly everything in
the world depends on it.
And if our supply
were to ever run out,
the global economy
would grind to a halt.
I bet you think I'm
talking about oil.
Think again.
This is the rubber episode.
Whether you like it or not,
we're all connected by money.
I'm Kal Penn, exploring
this giant beast
that is the global economy.
To truly appreciate how
much we rely on rubber,
I need to get a taste
of it in a monster dose.
Philadelphia,
this is Monster Jam.
Monster Jam rolls
on mammoth tyres.
And nothing else
but natural rubber
can handle the impact of those
sick monster truck jumps.
Besides tyres, rubber
has crammed its way
into just about everything,
from the clothes you wear
to the items around
your house and beyond.
Rubber lets you bounce
in this super fun thing.
And these super fun things.
Yeah, that's a whole
different kind of bounce.
Natural rubber is a
$26 billion industry.
It is the backbone of the economy.
The world's demand
for natural rubber
is about 13,000
kilometric tonnes a year,
or the equivalent of
86,868 blue whales.
That's a lot of rubber.
And Monster Jam has
a huge demand for it.
What? What?
Yeah.
I wanna ask you about rubber.
You're like the rubber guy.
The rubber guy.
I'm not sure if I like that.
Bill Easterly is responsible
for putting tyres
on all those Monster Jam trucks.
With 33 years of motor
sports experience,
he knows a lot about when
the rubber hits the road,
or dirt, or whatever.
So you know a lot about tyres.
How important are tyres
and rubber to Monster Jam?
Well, we can't,
perform without them.
Yeah.
We have trucks that
are jumping in the air,
landing on the ground at 20 Gs.
The truck weighs 12,000 pounds.
The maths is almost a
quarter million pounds
of force hitting the ground.
The tyres have to
survive that repeatedly.
So the tyres are very important.
How much do tyres like this cost?
These tyres can cost $3,000.
- People ask
- Each?
- Each. Yeah.
- Oh, whoa.
What we do to tyres
isn't fair to begin with,
sending them 30 feet in the
air, crashing these trucks
all over the floor,
crushing over cars.
We can damage a tyre
once in a while.
So we have to build an
extra, extra strong tyre
to withstand what we do to them.
Natural rubber builds a
great extra strong product
so that we can be the
type of performers we are.
There are synthetic rubbers
made from petroleum,
but the most vital rubber
products can't be synthetic.
Why?
In the face of heat,
abrasion and age,
synthetic rubber
just won't hold up.
Synthetic rubber plane tyres?
Don't even think about it.
They can't handle the landing,
and they would blow
up on the runway.
It's the same with long-haul
trucks driving cross country.
Synthetic rubbers
can't take the beating.
Natural rubber is the only
substance known to man
that can do the
things that planes,
trucks, and these monsters need.
But natural rubber is in
real danger of disappearing,
and if it does, it would
be the end of Monster Jam
and nearly everything else
you depend on in life.
This is the source of natural
rubber, the raw sap or latex
from the Brazilian rubber
These trees are monoclonal,
meaning this tree and this tree
and this one all share the
exact same genetic make-up.
Which also means that
they're all susceptible
to the same disease.
That disease is a fungus
called Rubber Tree Blight,
Microcyclus ulei.
For a rubber tree, it's
like the Black Death,
the Spanish flu,
and Ebola combined.
There's no vaccine or cure.
How scary is an outbreak?
Well, since all rubber
trees are basically
identical siblings, this
disease has the potential
to destroy the entire
rubber industry.
With all this potential
devastation and a clear threat
to our global supply of
rubber, who do you call
when that vicious little
spore has big plans?
Only the most extreme, badass,
take no prisoners
plant pathologist.
- Can I wear this?
- Indeed, you can.
I got an honorary doctorate once
- for doing nothing.
- You did?
Well, that's the usual
- So we are both doctors.
- Oh, we are indeed.
But you actually know
what you're doing.
Yeah, well, my career
has actually been
mainly in the tropics.
I've worked mainly
on tropical crops,
coffee, cacao and rubber.
Let's get some
rubber trees to cough
and see how they're doing.
Dr Harry Evans has had
over 40 years of experience
battling plant and
fungal diseases.
He spends most of
his time in the lab,
cataloguing archived specimens,
including leaf blight.
And this would the first
place that rubber material
would come from, almost
certainly from Asia,
and to where disease is
suspected, rubber blight.
Okay.
This specimen here is
in fact rubber blight
from Trinidad from the 1980s.
These are called shot holes,
and that's what
happens to the leaves.
You see the shot holes.
- Yeah.
- And all the leaves fall out,
and eventually, the leaf
will fold prematurely,
and the whole tree
will be defoliated,
and possibly death of
the tree after that.
The collector here,
Chi, was Malaysian,
and he was looking at all
aspects of the disease
to make himself
acquainted with it.
So in fact, when you
look at it, you can
- I'm sorry.
- I'm laughing because
in Hindi, "chi" means shit.
So this is Dr Shit who
sent you these samples.
Yeah, so what Chi's
sort of descriptions,
the first people on the
scene may be able to say,
"Yes, that's rubber blight."
And looking simply down
this microscope, at it,
you see those structures there.
Oh, yeah, wow.
Yeah, so that's the eruption.
And what happens then,
it pushes the leaf out
and then it becomes like
this Swiss cheese
I mean when you say eruption,
that actually looks
like a mountain range.
Yeah, yeah.
At that magnification, yeah.
Within those are the structures
holding the sexual spores.
- Okay.
- Which are then violently
released and carry on the process.
This is a viable structure.
It's a mountain range.
So it's protected, and
inside are the spores.
And it's a very
slow-growing fungi.
It's three or four weeks.
It takes three or four
weeks to get to that stage?
To get to that sort of growth.
- Whoa. Okay.
- Yeah.
So if you put a little
sample of that in there,
in four weeks, it
would look like that?
Yeah.
And if they find rubber blight
or if you find
rubber blight rather,
they send you a sample,
by the time you get it,
is it too late to do
something about it?
The alarm bells would go.
Once this disease gets
going through a plantation,
it just wipes it out.
It's already happened once before.
A hundred years ago,
90% of all the world's
natural rubber supply
came from Brazil,
which led to companies
like Ford creating massive
rubber plantations to
make tyres for their cars.
In the 1930s, leaf
blight attacked,
jumping from tree to tree so fast
that by the time it was
discovered, it was too late.
This tiny spore laid waste
to almost all the
trees in South America.
Ford had invested $20
million into the plantation,
or roughly $280 million
in today's dollars.
They ended up selling
it back to Brazil
for a little over 1% of
what they had invested.
Now, Brazil's share
of the rubber market
has dropped from 90% to 0.001%.
Where are the other
rubber plantations?
The majority are
in Asia, 90%, 95%.
Oh, 95% of industrial rubber
for the whole world
is Natural rubber,
it would be Asian in origin, yes.
Got it. So then it's
fairly targeted.
If leaf blight would
have hit there,
it could disrupt most
of our rubber supply.
Yes, I think, well,
it would disrupt the
whole world economy.
There's no geographic
barriers after that.
It would spread throughout the
whole region, like it spread
toward the whole of South
and Central America.
If it were to arrive,
I think it would be very
difficult to contain it.
What would happen if leaf
blight managed to spread
across the Pacific Ocean
and take hold in Asia?
Not only would it spell the end
to my monster truck rallies,
it could take a sledgehammer
to our global economy.
Could you imagine?
If not, let me help you.
And here we are.
The apocalypse looks like
this, where all planes
are grounded and the world
comes to a screeching halt.
You see how massive
these things are.
Yeah, that's huge.
I guess this is all
still being help up by
Yeah, held up by rubber tyres.
I'm here to find out what a world
without all this rubber
would mean for us.
An aeroplane graveyard where
one-time titans of the skies
are hacked apart and
salvaged for scraps.
So these tyres
100% natural rubber.
- Even these.
- Almost certainly
because they're such heavy duty.
I hear we can see in here
there might be some bits left.
There would have been some seals
and gaskets and things in there.
I assume this has rubber
components, or is it all plastic?
Well, here's the rubber.
- Oh, okay.
- There's some rubber there.
There might be some rubber
in these luxury pads
so your glass of alcohol
or champagne doesn't slip.
So would anything up here
be made out of rubber?
Yeah, you got it.
Dr Katrina Cornish has
been trying to warn us all
about the economic consequences
of a world without rubber.
And she has a very clear message
about this potential
rubber crisis.
We must not continue to rely
on a clonal tree that
is disease sensitive.
This is a ridiculous way
to run a global economy.
Is leaf blight a real threat?
Absolutely. Over
the last 20 years,
it's appeared in India
once, in Thailand once.
And then it was
wholesale extermination
of everything in
sight to control it.
If you try and fly on an aeroplane
from South America
to South-east Asia,
you'd be very hard
pressed to find a flight.
You have to go somewhere
else and get off the plane,
get on a plane that hasn't
been to South America,
and it's to do with
leaf blight quarantine.
- Is that right?
- Yeah, yeah.
It can't make the ocean crossing
because it's quite short lived,
but it can make the
aeroplane crossing.
So if this happens
and if these trees
start getting wiped out,
what happens to the economy
or the impact of
not getting rubber?
There would, it would be a
catastrophic economic collapse.
There's no sector of
the modern economy
that isn't completely dependent
upon the availability
of natural rubber.
You are going to lose, eventually,
the entire modern world.
You are going to lose it.
We are going to go back 120,
130 years to what you can do.
- Oh, wow.
- Yes.
You know, ox carts, we go
back to ox carts or something.
You know, horses and leather.
There's nothing, medicine,
transportation, you name it.
So how do we solve
the rubber problem?
We solve the rubber problem
by increasing the biodiversity
of the rubber supply
and doing that as quickly
as we possibly can.
So there's an opportunity for
governments to invest now.
Absolutely. But you know,
we're not good at that.
Something catastrophic happens,
it's like, "Oh, gosh,
that was a bad thing."
And the fact that dozens
of people might be saying,
"This is gonna happen.
This is gonna happen.
"This is gonna happen.
"This is gonna happen."
"Oops, did we know
this was gonna happen?"
"Well, we've been
trying to tell you.
"You wouldn't listen.
"You didn't want to be proactive.
"You wanted to be reactive."
So why isn't the global
economy doing something
to counter the potential
effects of leaf blight?
It turns out economies
have the tendency
to not address the very
problems that might affect them,
the kinds of problems
that could happen
just about any place
that money changes hands.
When someone talks about
uncertainty in the economy,
they're likely referring to
externalities, outside variables
that can affect everyone
connected to the market.
Externalities can be positive,
like last year in 2004
when MySpace opened up a
headquarters down the road.
Stable jobs for years to come.
But more often,
externalities take the form
of catastrophes, ecological
diseases like leaf blight,
natural disasters like hurricanes,
and even man-made fuck-ups
like a nuclear meltdown,
or in my case, the fact
that my house was built
on an ancient burial ground.
Look what attacked me in my sleep.
Oh, how much for the bones?
They're not for sale, you monster.
Okay, seven bucks.
Now to make ends meet, I
have to sell all this shit.
When I bought this stuff,
the market didn't price
in the externalities
that now make this crap
impossible to sell.
I can't believe I didn't
get a discount on my Hummer
in case of a spike in gas prices.
What's it cost to
fill up the tank?
Infinity dollars.
I paid 15 bucks a
pop for these CDs,
but now I'm letting
them go for $0.50 each.
Ooh, except for the Papa Roach.
Collector's item.
If you buy them, you could
take the records for free.
Vinyl's never coming back.
Oh, Google is over $100 a share?
Now that it's clearly topped out,
I'll cash out and move to a
place that has no burial ground.
I heard that New Orleans doesn't
bury their people underground.
Well, it looks like this guy
is headed out to the Big Easy.
Safe travels.
Thanks, lady.
New Orleans in 2005,
what could go wrong?
So what does this looming
externality of leaf blight
mean for the people in
the rubber supply chain?
To find out, I'm
starting my journey
at the beginning of the
natural rubber trail.
Thailand produces
more than a third
of the planet's rubber on
plantations just like this one
in the middle of what
used to be a rainforest.
This is Bo.
His job is to harvest
the raw rubber or latex.
His workday is just beginning.
Like the condom, latex
is tapped all night,
into the early morning
because during the day,
the jungle heat causes the
latex to coagulate too quickly.
That's where the
metaphor falls apart.
First, you remove last
night's dried latex.
- Tap the tree slowly.
- Oh, wow.
Wow.
Okay?
How long does that
take to fill up?
It takes about six
hours to fill up.
How many trees do
you do at one time.
It is
one thousand trees.
Sometimes it can be up
to twelve hundred trees.
Wow.
It takes about two years for a
tree to produce enough rubber
to make one regular car tyre,
not even a monster truck tyre.
As you guys can see, it's raining.
In reality, these guys don't
tap rubber trees in the rain
because the water
dilutes the latex.
But we've got like 20
people behind the camera,
came to the middle of
Thailand, it's three o'clock
in the morning, for the rubber
episode, so here we are.
Now, just one tree left.
And then we are going to weigh it.
Come.
After tapping latex all night,
Bo is collecting buckets
of the white liquid.
We're going to weigh it now.
Once the buckets are filled,
Bo must drive to the
plantation weigh station
to find out how much he'll
earn for the night's work.
This plantation contains
475 acres of rubber trees.
If just a few spores
of blight landed here,
the trees could all be wiped
out in just a few weeks.
There are 30 tappers like Bo
who both live and work
on this plantation.
Once the rubber is weighed,
the plantation
owner will pay them.
My father bought this property
and started planting rubber trees.
He bought it specifically
for rubber trees?
Yeah.
When the Thai government
offered incentives
to rubber farmers eight years ago,
the owner of this
plantation, Dr Chukiet,
planted many new trees.
Though a rubber tree
can last for 25 years,
it takes seven years
for one to mature.
So he has only recently seen
any return on his investment.
So what's happening out there?
We bring the latex in from
the tapping tree, okay?
And now we go to
measure the weight.
How much it weighs, okay?
And today's price
is 47 baht per kilo.
47 baht per kilo.
That's today's price.
Yeah, today's price.
How do you know,
what today's price is?
We have to call the factory.
Oh, the factory will tell you?
Yeah.
47 baht per kilo equates to about
US $1,300 per tonne
of liquid rubber.
Dr Chukiet splits the earnings
with the tappers 60/40,
which means that Bo will
get only about nine bucks.
In Thailand, that's less
than the daily minimum wage.
This is the problem that we have,
problem with nowadays.
Worker shortage,
because of the low price.
Okay.
The workers prefer to tap
when the price is high.
- Yeah.
- We couldn't recruit new workers
when the old worker resigns, okay?
We couldn't find a
new one to replace.
Before we used to be able
to produce about six tonnes.
Six tonnes.
Per day.
Right now, it's
two tonnes per day.
Two tonnes a day?
- Yeah.
- Wow.
So that dropped by more than half.
More than half. That's
why our production
become low now.
Okay. Have the prices
been low the whole time,
or is it just recently?
Oh, The price now,
the price has been down
for a couple of years now.
- It's been down?
- Yeah. It's about
now, it's about thirty
percent of what it used to be.
It's 30% of what it used to be?
Yes.
- Three years ago?
- Two years ago.
It's quite a problem in Thailand.
Business before,
we used to live on
rubber plantation
as the main income.
And now we try to
shift our rubber to
to coconut or to
palm oil production.
And we start to
diversify our business.
And now we cut down the
the old rubber tree.
I don't understand.
If leaf blight is such a
threat to the rubber supply
and demand for natural
rubber is always on the rise,
why are the prices so low
that farmers like Dr
Chukiet are losing money
and considering chopping
down their rubber trees?
So where does the
rubber go from here?
Okay, then after it's ready,
we get the latex from
the tank to the van.
- Send it to the factory.
- Okay.
So these whole things go.
Go to factory.
If Dr Chukiet says
that he gets the price
from the factory, then
that's where I'm headed
to find out exactly
why it's so low.
This rubber factory is
owned by Robert Meyer.
In eight short years, he
went from one factory to 38.
He now produces 14% of
all the world's rubber.
Those drums of gooey
latex look like this
when Robert gets
through with them,
before he sells them
to a tyre company.
Kal, you can feel this
is number one, warm.
And it's sticky.
- It is. Whoa.
- So the process of baking
has done two things.
It has stabilised
the decomposition of the product.
So the organic deterioration
has been stopped
because it has been baked.
And it amplifies the
adhesion properties.
Okay.
And it turns brown from
the drying process?
- Yeah. Like a cookie.
- Yeah.
So these are the weighing stations
where two biscuits are
put on top of each other.
Small bits are cut off or added
to make exactly a
thirty-five kilo brick.
Cool.
So here are now with
finished products.
Okay.
So this is where the Wonka
bars get shipped out.
That's the job of a rubber factory
is to convert the agricultural
produce into an
industrial material.
Yeah, that's really cool.
So as you would have
figured out, right?
We have two handovers
which are relevant.
Farmer handing over
an agricultural
produce to the factory.
Factory handing over an
industrial raw material
to the maker of rubber products.
Right, those are the
two handover points
where the baton passes to the
next part of the value chain.
Are you worried about leaf blight?
Is that a serious concern?
Everybody is always
worried about leaf blight.
- Okay.
- Okay?
Now that little bug hasn't made,
found its way to South-east Asia.
Look, maybe I'm too naive,
or maybe I'm too
emotionally invested
in what I do to really
think about that too much.
But even if it came
to South-east Asia,
it would be cause for a
cost explosion of rubber.
But it sounds like that cost
isn't factored into
that current price.
And then talking
to rubber farmers,
and they're saying in
the last three years,
the price they're
getting for their
latex has dropped dramatically.
Tremendously.
Help me understand why that is.
Okay, to understand that,
you really have to understand
the history of rubber.
Okay, so back in the day,
there was a huge disconnect
in terms of time, in
terms of connectivity,
being able to speak
with one another
between the origin
and the consumer.
So if you're a buyer,
say you're a tyre maker,
and I'm a seller, you
wanna know that you can buy
this product not just today from
what I have in the warehouse,
but you wanna have this
product throughout the year.
- Okay.
- Because you depend on it.
Okay.
So in order to bridge that,
they created a futures market,
and the rubber was traded
on a futures market.
Can you explain what
a futures market is?
Okay, so a futures market is
where a buyer and a seller
agree to certain terms
of price, of volume,
of grades, of
specification, of origin,
basically everything which
you'd find in a contract,
for delivery at some
point in the future.
Okay.
So if I was a producer and I
agree to supply you tonnage
at price, at date, you will
buy from an American trader
who had an office in New York,
who had a subsidiary in
Singapore, and he will transact
either directly or through
another layer of middle men
with the original
producer, i.e. me.
Okay.
And between us, we would guarantee
that we would supply
you what you want
at the agreed price
on the agreed date.
So the futures market is a
venue where, frankly speaking,
I have very little say, if any.
Even my customers
don't have a say.
If you speak to most
of my customers,
they will tell you that
they want higher prices
because they know the farmers
are about to say enough,
but neither of us who participate
physically have control.
We're gonna need to
understand futures better.
A futures contract is kinda
like a concert ticket.
Tickets could sell months
before I actually perform.
The contract is based on demand.
I wouldn't charge $100
to see me in an arena
if I didn't think I
could sell it out.
Girl, you are too humble.
You can sell out the moon.
Ooh, tour on the moon.
Thank you, hype man.
I sell these concert
tickets way in advance
because it minimises risk.
I worked so hard on
this upcoming tour.
I wrote an entire new album.
I choreographed all the
background dancers all by myself.
I mean, when I say it's dope
as hell, it is dope as hell.
So I need guarantees
that I'm gonna get paid
for that hard work.
And my fans want guarantees
that they're gonna
be able to see it.
I guarantee if I
don't see this show,
I'ma lose my shit, literally.
It's just gonna open
up and fall out.
People are gonna be
like, "What is that?"
I don't know.
So concert tickets
are futures contracts,
and scalpers are futures traders.
Of course, due to
market volatility,
these scalpers can
actually lose money,
like if I decided to
livestream my concert for free.
Oh, no, no, no, no, no, no.
You would literally
break the internet.
- We can't have that.
- I hope I won't have to.
But here's the worst part.
Scalpers buy so many
tickets that they control
significant supply, which
means they can set the price.
And that is market manipulation.
Your shows are market price.
You're like the lobster on a menu.
- Yeah, I am a lobster.
- Go get them, girl.
Hello, Cleveland.
While I go get this money
for the rest of these
Meghan Trainor tickets.
I got Meghan Trainor tickets.
They're going fast.
Show starts now.
So who are the scalpers
in the rubber industry?
It's these guys, traders on
the commodity futures markets.
Futures traders buy
up those contracts,
speculating that over time,
their value will increase.
The trader's goal is
to buy low, sell high
and get rich by
pocketing the difference.
Singapore is one of the biggest
financial hubs in the world.
It's where thousands of
commodities futures contracts
are traded everyday.
And one of the guys
who used to trade
those rubber
contracts is Dar Wong.
For 30 years, he worked for
big investment companies
and now travels around Asia,
offering advice to
struggling rubber farmers.
If we need rubber so badly, if
everybody in the world needs it
- Everybody needs some.
- Clothes, glasses, wires.
Yes.
Why is the price so low?
What actually influences the
price volatility of the rubber
is the global inflation
and recession.
- Okay.
- For example,
in 2013, rubber prices
started to fall,
and during this time, the
Thailand government actually said
that rubber prices
are probably going
through a short-term correction.
But rubber prices
actually did not recover,
and it went down lower
and lower and lower.
Obviously, when the
farmers started to realise
that prices are going down
they start to give up tapping.
They said they want to chop
it and remove the trees.
I think that is something
not very acceptable to
the global rubber economy.
So the farmer says the
factory sets the price.
But then the factory says the
futures traders set the price.
And the futures traders say
global inflation and
recession sets the price.
Amidst all the finger
pointing, how are the farmers
supposed to survive
any of this volatility?
Wouldn't it be stupid of them to
continue manufacturing rubber?
We always encourage the farmers
start to look for
alternate incomes,
keep the plantation alive,
because the prices
are moving on a cycle.
There are up cycles,
we have seen it.
There are down cycles.
And now we're still
going in the down cycles.
And after the down cycle finishes,
the next up cycle will come.
So it's a matter of
price oscillation.
Okay.
Is leaf blight a real
threat to rubber trees?
I think well
it is a real thing.
However, I think we
will leave this problem
to the plant doctors.
Because, you know, there is
not really a remedy on this,
but I think nothing
is worse than
the farmers that
want to chop it down.
Because once you chop the trees,
that's the end of the story.
So you think the farmers
are the greatest threat to the
Yes. Correct.
The farmers are the
greatest threat.
When they start to give up in
the business, in the industry,
they refuse to tap,
they want to chop it
or they just want to keep
the plantation dormant.
I think that is
the biggest threat.
As essential as rubber
is, you'd think the market
would do everything in its
power to protect the supply.
This is Ma Nui.
She's a rubber farmer in Thailand
and what Dar Wong refers
to as the greatest threat.
Cutting down her rubber trees
in the hopes to eventually
build a modest cottage
for a better income is what
she sees as her only option.
Is it hard to make decisions
like cutting down the trees?
Or do you see it
as just part of changes
that have to happen?
I don't have the money to
change or grow other things.
So, there is nothing
else I can do.
It doesn't matter what I
think of doing, you know?
I don't have the money
to grow anything.
I understand.
Ma Nui exemplifies the plight
of many rubber farmers.
They're caught in the
middle of a system
that's more concerned
with stopping them
from destroying their
trees than the loss
of the entire rubber
industry to leaf blight.
Meanwhile, we're buying
the latest running shoes
with no clue that the whole system
might run off a
cliff at any moment.
If disease and economic disaster
won't make the markets act,
are we just totally screwed?
Will the spectacle of
monster truck rallies
go the way of pole
sitting contests?
The invisible hard of the
free market may be turning
a blind eye to the issue,
but private industry
is starting to take some baby
steps to cover their assets.
That takes us to
the very last step
in the rubber supply chain,
a very important researcher
named Carla in a tyre
factory in Germany.
Continental Corporation,
one of the world's oldest
and biggest automotive companies,
is looking to develop
mass quantities
of an alternative kind of rubber.
It smells like harvesting
carrots, isn't it?
Yeah, almost like an indica
carrot sort of a smell.
Huh.
Continental has an annual revenue
of nearly $50 billion at risk.
- What is this made from?
- From dandelion roots.
Whoa.
Taraxacum kok-saghyz.
Continental is betting
on the dandelion
as a potential game changer
in the rubber industry
because unlike the rubber
tree, dandelions are able
to be grown annually
in moderate climates
and in soil that's not even
suited for cultivation.
Dandelions are resilient.
Carla Recker is the one
spearheading the effort,
and she's all business.
So how many trees, if you're using
the traditional rubber
trees, would it take
for one tyre versus
how many dandelions?
A rubber tree
approximately produces one
to one and a half kilograms
natural rubber per year.
For one tyre?
For the one tyre, you need
almost two, two trees.
And what about dandelions?
It's not the plants
which count there.
It's just the acreage
which is used for that,
and our goal is to have the
same yield per hectare in a year
like a rubber plantation.
Can you talk to me
about the differences
in how you source it?
So I know that for a rubber tree,
you tap the tree and
the substance comes out.
They collect it in cups.
But what's it like
with dandelions?
You just tap the dandelion and
No, that will not work because
where the natural rubber
in a dandelion is is in the roots.
- So that's, underneath the soil.
- It's in the root.
- It's under the
- It's in the root, yeah.
Therefore, you need a
process which works.
Getting rubber from a dandelion
isn't as simple as
notching a tree.
We're talking about thousands
of plants that need to be
cultivated, harvested, and
then their rubber extracted
through a complicated process
involving both human and machine.
So here are the dry
roots. It's very brittle.
And you can break it, and you
see it still keeps together.
And then between, in the
slit, you can observe
the very tiny strands of
rubber which are inside.
Continental has sunk
significant capital
into doing this.
And that is what you
have to separate out
by such a process, and then you
get this beautiful material.
All in the hopes that
this will pay off.
You've already made tyres
out of dandelions, right?
Right.
Is there anything you're
worried about in this process?
Oh, you can worry about a lot
of things being in that process
because we always are faced
with problems every year.
You have too much
rain, too less rain.
So you have all to handle this
kind of agricultural risk,
which a farmer does every year.
But we have to learn
that because we are
a rubber company and
not a farming company.
How did Continental decide to
invest in dandelion rubber?
Was that you?
I convinced the company to do so.
How do you convince a
huge global conglomerate
to invest in flower rubber?
Yeah, you have to be, on the
one hand side, enthusiastic,
but you have to have
reasons for being so.
The future of natural
rubber is essential for us
because the demand
is still growing,
like the tyre market is
growing and expected to grow.
And that's the reason why we
have to secure your own supply,
and therefore, we
have to start now.
Do you have a nickname here?
Some people call me
- or Miss Dandelion.
- Miss Dandelion?
That's cool.
It's not very much used.
We have Taraxacum tyres here,
the blossoms of the Taraxacum
here, and the seats.
This is the logo, how it looks
like when it's on a tyre itself.
- So whenever you see that
- That's what that is, yeah.
At a future time in the market,
then it is a Taraxacum tyre.
Oh, that's exciting.
I was reading that you guys
are within five to 10 years
of being able to produce
this industrially.
- Is that on track?
- That's what we are, working on,
but we have still a long way to
go until we will be successful
into having that industrialised.
So I will not say that we will
have solved the rubber crisis
for the whole world, but
if we don't start now,
we will never be able
to solve that problem.
Since markets don't seem
like they'll save us
and there's no massive
global collective action
to cure leaf blight
- Hi.
- Hey.
Maybe dandelions are
the future lifeblood
of the global economy.
We're betting that the
success of a few scientists
can create a global market
for these small yellow flowers
in time to prevent a calamity.
Let's keep our fingers crossed
that we will be saved by
another cycle of capitalism,
continually spinning
round and round
like, like
I wish I could come up with
a handy metaphor for this.
Hopefully, things
will turn out okay.
Maybe the rubber
industry can be saved
and we can continue to wear shoes,
eat food, and enjoy Monster Jam.
But we'd better buckle up,
because it might be a bumpy ride.
- Mark.
- Hey, if you buy them,
you can take the records too.
I'm not That's an
armrest I'm sitting on.
I overshot that
chair. My apologies.
Fuck. Where do I start?
I tell you what. I guarantee,
if I don't see this
show, I'ma lose my shit.
I'm talking about onto the floor.
It's gonna be not
good for anybody.
Literally, splat.
I will lose my shit.
I'm gonna have to
start wearing a diaper.
That's crazy. Did you
shit on the floor?
Who did that? My bad, I'm sorry.
Gee-whiz.
When I was a kid,
I was pretty sure
I knew how the world
was going to end,
alien invasion,
giant lizard attack,
or zombie apocalypse.
And even though some
people are still convinced
that Godzilla, flying saucers
and the body snatchers
are on the way.
Today, there's a more
immediate apocalyptic threat,
the potential disappearance
of a crucial global commodity
we rely on in ways we
don't even realise,
one specific commodity that's
so important, so ubiquitous,
nearly everything in
the world depends on it.
And if our supply
were to ever run out,
the global economy
would grind to a halt.
I bet you think I'm
talking about oil.
Think again.
This is the rubber episode.
Whether you like it or not,
we're all connected by money.
I'm Kal Penn, exploring
this giant beast
that is the global economy.
To truly appreciate how
much we rely on rubber,
I need to get a taste
of it in a monster dose.
Philadelphia,
this is Monster Jam.
Monster Jam rolls
on mammoth tyres.
And nothing else
but natural rubber
can handle the impact of those
sick monster truck jumps.
Besides tyres, rubber
has crammed its way
into just about everything,
from the clothes you wear
to the items around
your house and beyond.
Rubber lets you bounce
in this super fun thing.
And these super fun things.
Yeah, that's a whole
different kind of bounce.
Natural rubber is a
$26 billion industry.
It is the backbone of the economy.
The world's demand
for natural rubber
is about 13,000
kilometric tonnes a year,
or the equivalent of
86,868 blue whales.
That's a lot of rubber.
And Monster Jam has
a huge demand for it.
What? What?
Yeah.
I wanna ask you about rubber.
You're like the rubber guy.
The rubber guy.
I'm not sure if I like that.
Bill Easterly is responsible
for putting tyres
on all those Monster Jam trucks.
With 33 years of motor
sports experience,
he knows a lot about when
the rubber hits the road,
or dirt, or whatever.
So you know a lot about tyres.
How important are tyres
and rubber to Monster Jam?
Well, we can't,
perform without them.
Yeah.
We have trucks that
are jumping in the air,
landing on the ground at 20 Gs.
The truck weighs 12,000 pounds.
The maths is almost a
quarter million pounds
of force hitting the ground.
The tyres have to
survive that repeatedly.
So the tyres are very important.
How much do tyres like this cost?
These tyres can cost $3,000.
- People ask
- Each?
- Each. Yeah.
- Oh, whoa.
What we do to tyres
isn't fair to begin with,
sending them 30 feet in the
air, crashing these trucks
all over the floor,
crushing over cars.
We can damage a tyre
once in a while.
So we have to build an
extra, extra strong tyre
to withstand what we do to them.
Natural rubber builds a
great extra strong product
so that we can be the
type of performers we are.
There are synthetic rubbers
made from petroleum,
but the most vital rubber
products can't be synthetic.
Why?
In the face of heat,
abrasion and age,
synthetic rubber
just won't hold up.
Synthetic rubber plane tyres?
Don't even think about it.
They can't handle the landing,
and they would blow
up on the runway.
It's the same with long-haul
trucks driving cross country.
Synthetic rubbers
can't take the beating.
Natural rubber is the only
substance known to man
that can do the
things that planes,
trucks, and these monsters need.
But natural rubber is in
real danger of disappearing,
and if it does, it would
be the end of Monster Jam
and nearly everything else
you depend on in life.
This is the source of natural
rubber, the raw sap or latex
from the Brazilian rubber
These trees are monoclonal,
meaning this tree and this tree
and this one all share the
exact same genetic make-up.
Which also means that
they're all susceptible
to the same disease.
That disease is a fungus
called Rubber Tree Blight,
Microcyclus ulei.
For a rubber tree, it's
like the Black Death,
the Spanish flu,
and Ebola combined.
There's no vaccine or cure.
How scary is an outbreak?
Well, since all rubber
trees are basically
identical siblings, this
disease has the potential
to destroy the entire
rubber industry.
With all this potential
devastation and a clear threat
to our global supply of
rubber, who do you call
when that vicious little
spore has big plans?
Only the most extreme, badass,
take no prisoners
plant pathologist.
- Can I wear this?
- Indeed, you can.
I got an honorary doctorate once
- for doing nothing.
- You did?
Well, that's the usual
- So we are both doctors.
- Oh, we are indeed.
But you actually know
what you're doing.
Yeah, well, my career
has actually been
mainly in the tropics.
I've worked mainly
on tropical crops,
coffee, cacao and rubber.
Let's get some
rubber trees to cough
and see how they're doing.
Dr Harry Evans has had
over 40 years of experience
battling plant and
fungal diseases.
He spends most of
his time in the lab,
cataloguing archived specimens,
including leaf blight.
And this would the first
place that rubber material
would come from, almost
certainly from Asia,
and to where disease is
suspected, rubber blight.
Okay.
This specimen here is
in fact rubber blight
from Trinidad from the 1980s.
These are called shot holes,
and that's what
happens to the leaves.
You see the shot holes.
- Yeah.
- And all the leaves fall out,
and eventually, the leaf
will fold prematurely,
and the whole tree
will be defoliated,
and possibly death of
the tree after that.
The collector here,
Chi, was Malaysian,
and he was looking at all
aspects of the disease
to make himself
acquainted with it.
So in fact, when you
look at it, you can
- I'm sorry.
- I'm laughing because
in Hindi, "chi" means shit.
So this is Dr Shit who
sent you these samples.
Yeah, so what Chi's
sort of descriptions,
the first people on the
scene may be able to say,
"Yes, that's rubber blight."
And looking simply down
this microscope, at it,
you see those structures there.
Oh, yeah, wow.
Yeah, so that's the eruption.
And what happens then,
it pushes the leaf out
and then it becomes like
this Swiss cheese
I mean when you say eruption,
that actually looks
like a mountain range.
Yeah, yeah.
At that magnification, yeah.
Within those are the structures
holding the sexual spores.
- Okay.
- Which are then violently
released and carry on the process.
This is a viable structure.
It's a mountain range.
So it's protected, and
inside are the spores.
And it's a very
slow-growing fungi.
It's three or four weeks.
It takes three or four
weeks to get to that stage?
To get to that sort of growth.
- Whoa. Okay.
- Yeah.
So if you put a little
sample of that in there,
in four weeks, it
would look like that?
Yeah.
And if they find rubber blight
or if you find
rubber blight rather,
they send you a sample,
by the time you get it,
is it too late to do
something about it?
The alarm bells would go.
Once this disease gets
going through a plantation,
it just wipes it out.
It's already happened once before.
A hundred years ago,
90% of all the world's
natural rubber supply
came from Brazil,
which led to companies
like Ford creating massive
rubber plantations to
make tyres for their cars.
In the 1930s, leaf
blight attacked,
jumping from tree to tree so fast
that by the time it was
discovered, it was too late.
This tiny spore laid waste
to almost all the
trees in South America.
Ford had invested $20
million into the plantation,
or roughly $280 million
in today's dollars.
They ended up selling
it back to Brazil
for a little over 1% of
what they had invested.
Now, Brazil's share
of the rubber market
has dropped from 90% to 0.001%.
Where are the other
rubber plantations?
The majority are
in Asia, 90%, 95%.
Oh, 95% of industrial rubber
for the whole world
is Natural rubber,
it would be Asian in origin, yes.
Got it. So then it's
fairly targeted.
If leaf blight would
have hit there,
it could disrupt most
of our rubber supply.
Yes, I think, well,
it would disrupt the
whole world economy.
There's no geographic
barriers after that.
It would spread throughout the
whole region, like it spread
toward the whole of South
and Central America.
If it were to arrive,
I think it would be very
difficult to contain it.
What would happen if leaf
blight managed to spread
across the Pacific Ocean
and take hold in Asia?
Not only would it spell the end
to my monster truck rallies,
it could take a sledgehammer
to our global economy.
Could you imagine?
If not, let me help you.
And here we are.
The apocalypse looks like
this, where all planes
are grounded and the world
comes to a screeching halt.
You see how massive
these things are.
Yeah, that's huge.
I guess this is all
still being help up by
Yeah, held up by rubber tyres.
I'm here to find out what a world
without all this rubber
would mean for us.
An aeroplane graveyard where
one-time titans of the skies
are hacked apart and
salvaged for scraps.
So these tyres
100% natural rubber.
- Even these.
- Almost certainly
because they're such heavy duty.
I hear we can see in here
there might be some bits left.
There would have been some seals
and gaskets and things in there.
I assume this has rubber
components, or is it all plastic?
Well, here's the rubber.
- Oh, okay.
- There's some rubber there.
There might be some rubber
in these luxury pads
so your glass of alcohol
or champagne doesn't slip.
So would anything up here
be made out of rubber?
Yeah, you got it.
Dr Katrina Cornish has
been trying to warn us all
about the economic consequences
of a world without rubber.
And she has a very clear message
about this potential
rubber crisis.
We must not continue to rely
on a clonal tree that
is disease sensitive.
This is a ridiculous way
to run a global economy.
Is leaf blight a real threat?
Absolutely. Over
the last 20 years,
it's appeared in India
once, in Thailand once.
And then it was
wholesale extermination
of everything in
sight to control it.
If you try and fly on an aeroplane
from South America
to South-east Asia,
you'd be very hard
pressed to find a flight.
You have to go somewhere
else and get off the plane,
get on a plane that hasn't
been to South America,
and it's to do with
leaf blight quarantine.
- Is that right?
- Yeah, yeah.
It can't make the ocean crossing
because it's quite short lived,
but it can make the
aeroplane crossing.
So if this happens
and if these trees
start getting wiped out,
what happens to the economy
or the impact of
not getting rubber?
There would, it would be a
catastrophic economic collapse.
There's no sector of
the modern economy
that isn't completely dependent
upon the availability
of natural rubber.
You are going to lose, eventually,
the entire modern world.
You are going to lose it.
We are going to go back 120,
130 years to what you can do.
- Oh, wow.
- Yes.
You know, ox carts, we go
back to ox carts or something.
You know, horses and leather.
There's nothing, medicine,
transportation, you name it.
So how do we solve
the rubber problem?
We solve the rubber problem
by increasing the biodiversity
of the rubber supply
and doing that as quickly
as we possibly can.
So there's an opportunity for
governments to invest now.
Absolutely. But you know,
we're not good at that.
Something catastrophic happens,
it's like, "Oh, gosh,
that was a bad thing."
And the fact that dozens
of people might be saying,
"This is gonna happen.
This is gonna happen.
"This is gonna happen.
"This is gonna happen."
"Oops, did we know
this was gonna happen?"
"Well, we've been
trying to tell you.
"You wouldn't listen.
"You didn't want to be proactive.
"You wanted to be reactive."
So why isn't the global
economy doing something
to counter the potential
effects of leaf blight?
It turns out economies
have the tendency
to not address the very
problems that might affect them,
the kinds of problems
that could happen
just about any place
that money changes hands.
When someone talks about
uncertainty in the economy,
they're likely referring to
externalities, outside variables
that can affect everyone
connected to the market.
Externalities can be positive,
like last year in 2004
when MySpace opened up a
headquarters down the road.
Stable jobs for years to come.
But more often,
externalities take the form
of catastrophes, ecological
diseases like leaf blight,
natural disasters like hurricanes,
and even man-made fuck-ups
like a nuclear meltdown,
or in my case, the fact
that my house was built
on an ancient burial ground.
Look what attacked me in my sleep.
Oh, how much for the bones?
They're not for sale, you monster.
Okay, seven bucks.
Now to make ends meet, I
have to sell all this shit.
When I bought this stuff,
the market didn't price
in the externalities
that now make this crap
impossible to sell.
I can't believe I didn't
get a discount on my Hummer
in case of a spike in gas prices.
What's it cost to
fill up the tank?
Infinity dollars.
I paid 15 bucks a
pop for these CDs,
but now I'm letting
them go for $0.50 each.
Ooh, except for the Papa Roach.
Collector's item.
If you buy them, you could
take the records for free.
Vinyl's never coming back.
Oh, Google is over $100 a share?
Now that it's clearly topped out,
I'll cash out and move to a
place that has no burial ground.
I heard that New Orleans doesn't
bury their people underground.
Well, it looks like this guy
is headed out to the Big Easy.
Safe travels.
Thanks, lady.
New Orleans in 2005,
what could go wrong?
So what does this looming
externality of leaf blight
mean for the people in
the rubber supply chain?
To find out, I'm
starting my journey
at the beginning of the
natural rubber trail.
Thailand produces
more than a third
of the planet's rubber on
plantations just like this one
in the middle of what
used to be a rainforest.
This is Bo.
His job is to harvest
the raw rubber or latex.
His workday is just beginning.
Like the condom, latex
is tapped all night,
into the early morning
because during the day,
the jungle heat causes the
latex to coagulate too quickly.
That's where the
metaphor falls apart.
First, you remove last
night's dried latex.
- Tap the tree slowly.
- Oh, wow.
Wow.
Okay?
How long does that
take to fill up?
It takes about six
hours to fill up.
How many trees do
you do at one time.
It is
one thousand trees.
Sometimes it can be up
to twelve hundred trees.
Wow.
It takes about two years for a
tree to produce enough rubber
to make one regular car tyre,
not even a monster truck tyre.
As you guys can see, it's raining.
In reality, these guys don't
tap rubber trees in the rain
because the water
dilutes the latex.
But we've got like 20
people behind the camera,
came to the middle of
Thailand, it's three o'clock
in the morning, for the rubber
episode, so here we are.
Now, just one tree left.
And then we are going to weigh it.
Come.
After tapping latex all night,
Bo is collecting buckets
of the white liquid.
We're going to weigh it now.
Once the buckets are filled,
Bo must drive to the
plantation weigh station
to find out how much he'll
earn for the night's work.
This plantation contains
475 acres of rubber trees.
If just a few spores
of blight landed here,
the trees could all be wiped
out in just a few weeks.
There are 30 tappers like Bo
who both live and work
on this plantation.
Once the rubber is weighed,
the plantation
owner will pay them.
My father bought this property
and started planting rubber trees.
He bought it specifically
for rubber trees?
Yeah.
When the Thai government
offered incentives
to rubber farmers eight years ago,
the owner of this
plantation, Dr Chukiet,
planted many new trees.
Though a rubber tree
can last for 25 years,
it takes seven years
for one to mature.
So he has only recently seen
any return on his investment.
So what's happening out there?
We bring the latex in from
the tapping tree, okay?
And now we go to
measure the weight.
How much it weighs, okay?
And today's price
is 47 baht per kilo.
47 baht per kilo.
That's today's price.
Yeah, today's price.
How do you know,
what today's price is?
We have to call the factory.
Oh, the factory will tell you?
Yeah.
47 baht per kilo equates to about
US $1,300 per tonne
of liquid rubber.
Dr Chukiet splits the earnings
with the tappers 60/40,
which means that Bo will
get only about nine bucks.
In Thailand, that's less
than the daily minimum wage.
This is the problem that we have,
problem with nowadays.
Worker shortage,
because of the low price.
Okay.
The workers prefer to tap
when the price is high.
- Yeah.
- We couldn't recruit new workers
when the old worker resigns, okay?
We couldn't find a
new one to replace.
Before we used to be able
to produce about six tonnes.
Six tonnes.
Per day.
Right now, it's
two tonnes per day.
Two tonnes a day?
- Yeah.
- Wow.
So that dropped by more than half.
More than half. That's
why our production
become low now.
Okay. Have the prices
been low the whole time,
or is it just recently?
Oh, The price now,
the price has been down
for a couple of years now.
- It's been down?
- Yeah. It's about
now, it's about thirty
percent of what it used to be.
It's 30% of what it used to be?
Yes.
- Three years ago?
- Two years ago.
It's quite a problem in Thailand.
Business before,
we used to live on
rubber plantation
as the main income.
And now we try to
shift our rubber to
to coconut or to
palm oil production.
And we start to
diversify our business.
And now we cut down the
the old rubber tree.
I don't understand.
If leaf blight is such a
threat to the rubber supply
and demand for natural
rubber is always on the rise,
why are the prices so low
that farmers like Dr
Chukiet are losing money
and considering chopping
down their rubber trees?
So where does the
rubber go from here?
Okay, then after it's ready,
we get the latex from
the tank to the van.
- Send it to the factory.
- Okay.
So these whole things go.
Go to factory.
If Dr Chukiet says
that he gets the price
from the factory, then
that's where I'm headed
to find out exactly
why it's so low.
This rubber factory is
owned by Robert Meyer.
In eight short years, he
went from one factory to 38.
He now produces 14% of
all the world's rubber.
Those drums of gooey
latex look like this
when Robert gets
through with them,
before he sells them
to a tyre company.
Kal, you can feel this
is number one, warm.
And it's sticky.
- It is. Whoa.
- So the process of baking
has done two things.
It has stabilised
the decomposition of the product.
So the organic deterioration
has been stopped
because it has been baked.
And it amplifies the
adhesion properties.
Okay.
And it turns brown from
the drying process?
- Yeah. Like a cookie.
- Yeah.
So these are the weighing stations
where two biscuits are
put on top of each other.
Small bits are cut off or added
to make exactly a
thirty-five kilo brick.
Cool.
So here are now with
finished products.
Okay.
So this is where the Wonka
bars get shipped out.
That's the job of a rubber factory
is to convert the agricultural
produce into an
industrial material.
Yeah, that's really cool.
So as you would have
figured out, right?
We have two handovers
which are relevant.
Farmer handing over
an agricultural
produce to the factory.
Factory handing over an
industrial raw material
to the maker of rubber products.
Right, those are the
two handover points
where the baton passes to the
next part of the value chain.
Are you worried about leaf blight?
Is that a serious concern?
Everybody is always
worried about leaf blight.
- Okay.
- Okay?
Now that little bug hasn't made,
found its way to South-east Asia.
Look, maybe I'm too naive,
or maybe I'm too
emotionally invested
in what I do to really
think about that too much.
But even if it came
to South-east Asia,
it would be cause for a
cost explosion of rubber.
But it sounds like that cost
isn't factored into
that current price.
And then talking
to rubber farmers,
and they're saying in
the last three years,
the price they're
getting for their
latex has dropped dramatically.
Tremendously.
Help me understand why that is.
Okay, to understand that,
you really have to understand
the history of rubber.
Okay, so back in the day,
there was a huge disconnect
in terms of time, in
terms of connectivity,
being able to speak
with one another
between the origin
and the consumer.
So if you're a buyer,
say you're a tyre maker,
and I'm a seller, you
wanna know that you can buy
this product not just today from
what I have in the warehouse,
but you wanna have this
product throughout the year.
- Okay.
- Because you depend on it.
Okay.
So in order to bridge that,
they created a futures market,
and the rubber was traded
on a futures market.
Can you explain what
a futures market is?
Okay, so a futures market is
where a buyer and a seller
agree to certain terms
of price, of volume,
of grades, of
specification, of origin,
basically everything which
you'd find in a contract,
for delivery at some
point in the future.
Okay.
So if I was a producer and I
agree to supply you tonnage
at price, at date, you will
buy from an American trader
who had an office in New York,
who had a subsidiary in
Singapore, and he will transact
either directly or through
another layer of middle men
with the original
producer, i.e. me.
Okay.
And between us, we would guarantee
that we would supply
you what you want
at the agreed price
on the agreed date.
So the futures market is a
venue where, frankly speaking,
I have very little say, if any.
Even my customers
don't have a say.
If you speak to most
of my customers,
they will tell you that
they want higher prices
because they know the farmers
are about to say enough,
but neither of us who participate
physically have control.
We're gonna need to
understand futures better.
A futures contract is kinda
like a concert ticket.
Tickets could sell months
before I actually perform.
The contract is based on demand.
I wouldn't charge $100
to see me in an arena
if I didn't think I
could sell it out.
Girl, you are too humble.
You can sell out the moon.
Ooh, tour on the moon.
Thank you, hype man.
I sell these concert
tickets way in advance
because it minimises risk.
I worked so hard on
this upcoming tour.
I wrote an entire new album.
I choreographed all the
background dancers all by myself.
I mean, when I say it's dope
as hell, it is dope as hell.
So I need guarantees
that I'm gonna get paid
for that hard work.
And my fans want guarantees
that they're gonna
be able to see it.
I guarantee if I
don't see this show,
I'ma lose my shit, literally.
It's just gonna open
up and fall out.
People are gonna be
like, "What is that?"
I don't know.
So concert tickets
are futures contracts,
and scalpers are futures traders.
Of course, due to
market volatility,
these scalpers can
actually lose money,
like if I decided to
livestream my concert for free.
Oh, no, no, no, no, no, no.
You would literally
break the internet.
- We can't have that.
- I hope I won't have to.
But here's the worst part.
Scalpers buy so many
tickets that they control
significant supply, which
means they can set the price.
And that is market manipulation.
Your shows are market price.
You're like the lobster on a menu.
- Yeah, I am a lobster.
- Go get them, girl.
Hello, Cleveland.
While I go get this money
for the rest of these
Meghan Trainor tickets.
I got Meghan Trainor tickets.
They're going fast.
Show starts now.
So who are the scalpers
in the rubber industry?
It's these guys, traders on
the commodity futures markets.
Futures traders buy
up those contracts,
speculating that over time,
their value will increase.
The trader's goal is
to buy low, sell high
and get rich by
pocketing the difference.
Singapore is one of the biggest
financial hubs in the world.
It's where thousands of
commodities futures contracts
are traded everyday.
And one of the guys
who used to trade
those rubber
contracts is Dar Wong.
For 30 years, he worked for
big investment companies
and now travels around Asia,
offering advice to
struggling rubber farmers.
If we need rubber so badly, if
everybody in the world needs it
- Everybody needs some.
- Clothes, glasses, wires.
Yes.
Why is the price so low?
What actually influences the
price volatility of the rubber
is the global inflation
and recession.
- Okay.
- For example,
in 2013, rubber prices
started to fall,
and during this time, the
Thailand government actually said
that rubber prices
are probably going
through a short-term correction.
But rubber prices
actually did not recover,
and it went down lower
and lower and lower.
Obviously, when the
farmers started to realise
that prices are going down
they start to give up tapping.
They said they want to chop
it and remove the trees.
I think that is something
not very acceptable to
the global rubber economy.
So the farmer says the
factory sets the price.
But then the factory says the
futures traders set the price.
And the futures traders say
global inflation and
recession sets the price.
Amidst all the finger
pointing, how are the farmers
supposed to survive
any of this volatility?
Wouldn't it be stupid of them to
continue manufacturing rubber?
We always encourage the farmers
start to look for
alternate incomes,
keep the plantation alive,
because the prices
are moving on a cycle.
There are up cycles,
we have seen it.
There are down cycles.
And now we're still
going in the down cycles.
And after the down cycle finishes,
the next up cycle will come.
So it's a matter of
price oscillation.
Okay.
Is leaf blight a real
threat to rubber trees?
I think well
it is a real thing.
However, I think we
will leave this problem
to the plant doctors.
Because, you know, there is
not really a remedy on this,
but I think nothing
is worse than
the farmers that
want to chop it down.
Because once you chop the trees,
that's the end of the story.
So you think the farmers
are the greatest threat to the
Yes. Correct.
The farmers are the
greatest threat.
When they start to give up in
the business, in the industry,
they refuse to tap,
they want to chop it
or they just want to keep
the plantation dormant.
I think that is
the biggest threat.
As essential as rubber
is, you'd think the market
would do everything in its
power to protect the supply.
This is Ma Nui.
She's a rubber farmer in Thailand
and what Dar Wong refers
to as the greatest threat.
Cutting down her rubber trees
in the hopes to eventually
build a modest cottage
for a better income is what
she sees as her only option.
Is it hard to make decisions
like cutting down the trees?
Or do you see it
as just part of changes
that have to happen?
I don't have the money to
change or grow other things.
So, there is nothing
else I can do.
It doesn't matter what I
think of doing, you know?
I don't have the money
to grow anything.
I understand.
Ma Nui exemplifies the plight
of many rubber farmers.
They're caught in the
middle of a system
that's more concerned
with stopping them
from destroying their
trees than the loss
of the entire rubber
industry to leaf blight.
Meanwhile, we're buying
the latest running shoes
with no clue that the whole system
might run off a
cliff at any moment.
If disease and economic disaster
won't make the markets act,
are we just totally screwed?
Will the spectacle of
monster truck rallies
go the way of pole
sitting contests?
The invisible hard of the
free market may be turning
a blind eye to the issue,
but private industry
is starting to take some baby
steps to cover their assets.
That takes us to
the very last step
in the rubber supply chain,
a very important researcher
named Carla in a tyre
factory in Germany.
Continental Corporation,
one of the world's oldest
and biggest automotive companies,
is looking to develop
mass quantities
of an alternative kind of rubber.
It smells like harvesting
carrots, isn't it?
Yeah, almost like an indica
carrot sort of a smell.
Huh.
Continental has an annual revenue
of nearly $50 billion at risk.
- What is this made from?
- From dandelion roots.
Whoa.
Taraxacum kok-saghyz.
Continental is betting
on the dandelion
as a potential game changer
in the rubber industry
because unlike the rubber
tree, dandelions are able
to be grown annually
in moderate climates
and in soil that's not even
suited for cultivation.
Dandelions are resilient.
Carla Recker is the one
spearheading the effort,
and she's all business.
So how many trees, if you're using
the traditional rubber
trees, would it take
for one tyre versus
how many dandelions?
A rubber tree
approximately produces one
to one and a half kilograms
natural rubber per year.
For one tyre?
For the one tyre, you need
almost two, two trees.
And what about dandelions?
It's not the plants
which count there.
It's just the acreage
which is used for that,
and our goal is to have the
same yield per hectare in a year
like a rubber plantation.
Can you talk to me
about the differences
in how you source it?
So I know that for a rubber tree,
you tap the tree and
the substance comes out.
They collect it in cups.
But what's it like
with dandelions?
You just tap the dandelion and
No, that will not work because
where the natural rubber
in a dandelion is is in the roots.
- So that's, underneath the soil.
- It's in the root.
- It's under the
- It's in the root, yeah.
Therefore, you need a
process which works.
Getting rubber from a dandelion
isn't as simple as
notching a tree.
We're talking about thousands
of plants that need to be
cultivated, harvested, and
then their rubber extracted
through a complicated process
involving both human and machine.
So here are the dry
roots. It's very brittle.
And you can break it, and you
see it still keeps together.
And then between, in the
slit, you can observe
the very tiny strands of
rubber which are inside.
Continental has sunk
significant capital
into doing this.
And that is what you
have to separate out
by such a process, and then you
get this beautiful material.
All in the hopes that
this will pay off.
You've already made tyres
out of dandelions, right?
Right.
Is there anything you're
worried about in this process?
Oh, you can worry about a lot
of things being in that process
because we always are faced
with problems every year.
You have too much
rain, too less rain.
So you have all to handle this
kind of agricultural risk,
which a farmer does every year.
But we have to learn
that because we are
a rubber company and
not a farming company.
How did Continental decide to
invest in dandelion rubber?
Was that you?
I convinced the company to do so.
How do you convince a
huge global conglomerate
to invest in flower rubber?
Yeah, you have to be, on the
one hand side, enthusiastic,
but you have to have
reasons for being so.
The future of natural
rubber is essential for us
because the demand
is still growing,
like the tyre market is
growing and expected to grow.
And that's the reason why we
have to secure your own supply,
and therefore, we
have to start now.
Do you have a nickname here?
Some people call me
- or Miss Dandelion.
- Miss Dandelion?
That's cool.
It's not very much used.
We have Taraxacum tyres here,
the blossoms of the Taraxacum
here, and the seats.
This is the logo, how it looks
like when it's on a tyre itself.
- So whenever you see that
- That's what that is, yeah.
At a future time in the market,
then it is a Taraxacum tyre.
Oh, that's exciting.
I was reading that you guys
are within five to 10 years
of being able to produce
this industrially.
- Is that on track?
- That's what we are, working on,
but we have still a long way to
go until we will be successful
into having that industrialised.
So I will not say that we will
have solved the rubber crisis
for the whole world, but
if we don't start now,
we will never be able
to solve that problem.
Since markets don't seem
like they'll save us
and there's no massive
global collective action
to cure leaf blight
- Hi.
- Hey.
Maybe dandelions are
the future lifeblood
of the global economy.
We're betting that the
success of a few scientists
can create a global market
for these small yellow flowers
in time to prevent a calamity.
Let's keep our fingers crossed
that we will be saved by
another cycle of capitalism,
continually spinning
round and round
like, like
I wish I could come up with
a handy metaphor for this.
Hopefully, things
will turn out okay.
Maybe the rubber
industry can be saved
and we can continue to wear shoes,
eat food, and enjoy Monster Jam.
But we'd better buckle up,
because it might be a bumpy ride.
- Mark.
- Hey, if you buy them,
you can take the records too.
I'm not That's an
armrest I'm sitting on.
I overshot that
chair. My apologies.
Fuck. Where do I start?
I tell you what. I guarantee,
if I don't see this
show, I'ma lose my shit.
I'm talking about onto the floor.
It's gonna be not
good for anybody.
Literally, splat.
I will lose my shit.
I'm gonna have to
start wearing a diaper.
That's crazy. Did you
shit on the floor?
Who did that? My bad, I'm sorry.