Rubber Wars: Rubber at the End of Empire in Colonial Malaya,c. 1945–57

On 16 June 1948, the lives of the rubber planting community in Malaya would be changed forever. At around nine o’clock in the morning, three young men had cycled up to the estate office of the Elphil estate in Sungei Siput in Perak, a short distance north of the tin-mining town of Ipoh. Walter (Wally) Walker the estate manager and a clerk were in the office starting the day's administrative chores. As one of the men came in to greet Wally with a tabek tuan (a deferential greeting in Malay), the other two slipped through the back entrance and shot him in the head and chest at point-blank range, leaving the clerk staring in horrified shock as the three men got back on their bikes and rode off like the blazes. Thirty minutes later around 12 men arrived at the adjacent Phin Soon estate armed with Sten guns and revolvers and murdered the estate manager John Allison and assistant Ian Christian in cold blood before setting alight to 66,000 pounds of rubber packed in smokehouses ready for shipment. The following day, Cheng Choy, an estate contractor, was found murdered on the Subur estate north-west of Ipoh and, another contractor (a supposed Kuomintang member) was shot and killed by 10 men on a lonely road on the Senai estate, to the north of Johore Bahru town. ¹

These five murders, two men of Chinese ethnicity and three Caucasians, all on rubber estates within the Federated Malay States, were attributed to Malayan supporters of Communism. The British High Commissioner, Sir Edward Gent, declared a situation of emergency in the Ipoh and Sungei Siput districts of Perak and, in several districts in Johore and sanctioned the death penalty for the unauthorised possession of firearms. While there had been labour unrest and trade union-led uprisings since even before the Second World War, these violent incidents were thought to have been instigated by the Malayan Communist Party (MCP). As news of the five plantation murders broke across Malaya, Britain could no longer assume that Communism was not a threat to her Southeast Asian interests, especially the lucrative rubber industry that was a cornerstone of the Malayan (and thus colonial) economy.

Malaya's meteoric rise in the early twentieth century rubber industry had a little to do with science or cogent governmental planning but much to do with luck and entrepreneurialism. America – the largest consumer of rubber in the world – was at the time of larger-scale rubber experimentation in Southeast Asia then developing its transportation industry with steep requirements for rubber but, had few natural or synthetic resources of its own to provide the raw materials needed. The outbreak of the First and then the Second World War demonstrated how the world had begun to rely on rubber as a strategic commodity, the material providing the basis of countless military, as well as day-to-day, uses. The Second World War however was the first real point at which Malayan dominance in dictating global trade and supply was assailed, fundamentally and forevermore changing the balance of power in the world, and in the rubber market. The new political and economic landscape that emerged in 1945 was one where it was clear that the USA could not, and would not, rely on Southeast Asia as their core supplier as passively as it had previously and, the war had also changed America's position in the world. By 1945, they had dropped their policy of isolationism and had gained a more developed synthetic rubber industry. Britain, owing a heavy war debt to the USA and engaged in dismantling their Empire in India and Burma, were facing a new threat to their core Malayan economic commodity due to a lack of modernisation and an internecine conflict starting in 1948, much of which was played out on the European-run rubber estates. Unable to persuade the USA to drop their post-1945 restrictions on rubber buying and facing an embattled industry in Malaya, they were forced instead to focus on facilitating modernisation for smallholdings, by introducing a policy of economic aid, educating small rubber holdings in newer scientific methods and by replacing old trees with newer, more resilient and higher yielding varietals as an antidote to decline.

Rubber has been conceptualised by some historians as the making of modern Malaya. ² The commodity rose from occupying a relatively small place in exports in 1905 at around 0.6 of all Malayan export revenue 1910 (at 6313 long tonnes of crude product) to being one of the largest export commodities and highest revenue earner for the Malayan and British governments by 1941 (at 575,000 long tonnes). ³ In terms of exports as a percentage of all Malayan cash crops, this was 93.2% in 1940. ⁴ In one generation, the success of rubber was to shape the Malayan landscape – literally and figuratively – making millionaires through land sales, production and trade. This is not in doubt. However, it is widely known that the industry went into a gradual decline from the 1950s, what is lesser known is the place of the rubber industry in the eventual demise of British authority in the region. Seen as the epitome of colonialism, the Cold War in Malaya played out in hot circumstances on the large estates and, interfered with modernisation plans for many of the smallholdings, financially, as well as ideologically.

This article re-examines the Malayan rubber industry between 1945 and 1957. Drawing inspiration from Mark Findlay's work on the intersection of strategic commodities and national security over the early to mid-twentieth century and, that of Greg Mitman which situates the rubber industry as shaping, and being shaped by, geopolitics, this article explores how the West's ideological and physical wars produced as well as answered to the conditions of the industry across this period. ⁵ As historian of Cold War politics in Southeast Asia Wen-Qing Ngoei reminds us, it is important to view the intimate relationship between Britain and USA from the historiographically neglected perspective of Malaya. This article positions the rubber industry as the lens through which to view this relationship, charting how the industry pivoted in response to a changing internationalism. ⁶ It argues that, although rubber had in many ways made Malaya, it was also strategically positioned as an artefact within Britain's eventual decolonisation. Although there were injections of capital into the economy during the First, Second and Korean wars due to the uptick in demand for the by-now strategic commodity, its strong association with British imperialism had placed the industry at the forefront of an anti-colonial narrative by the 1940s. This was apparent during the ‘Malayan Emergency’ war on the ground of 1948 to 1957, much of which was fought on the rubber estates and in the nearby jungles, as symbols of colonial exploitation, impacting on production and the government's ability to modernise the industry. Yet, and indeed because of this, Malayan rubber was appropriated by the British and the Americans as an anti-communist commodity, the purchase of which was couched as a patriotic duty. Thus, ideologically and economically, rubber played its part in the making and ultimately the breaking, of colonial Malaya.

At the end of the Second World War, Britain may have emerged ostensibly victorious but, her empire was crushed under the weight of war debts, an overwhelming task of reconstruction and, was seen by some as increasingly anachronistic, a relic of a bygone and politically incorrect era. British Malaya which, from 1939 to 1941 had been at its height, an impenetrable fortress on the edge of the Eastern empire, producing enough rubber to supply Britain and her allies – especially America – had reigned supreme due to the massive war-driven surge for the natural commodity that brought some Malayans exceptional wealth and power. By the early 1950s, more than three and a half million acres of Malaya were under active rubber production and the industry employed more than half a million people (of a population of around six million), this simply in the direct cultivation, not even those involved in trading and manufacturing. ⁷ Yet, after the war, things were not the same as they had been. Although the rubber industry had managed to revive relatively fast, with most estates resuming full production by early 1946 and even exceeding pre-war production in many cases by 1947, the overall standard of living across Malaya had fallen to below the pre-war standard. ⁸

The decline in living standards was driven by continued restrictions on imports and foodstuffs following hard on the heels of the privations of the Japanese Occupation of 1942 to 1945. The resumption of British rule in 1945 had taken place under the auspices of the British Military Administration (BMA), an interim government expected to manage immediate postwar rehabilitation. The BMA however was deeply unpopular, and the termination of their authority had been followed shortly thereafter by a failed experiment in governance known as the Malayan Union, replaced by a Malayan Federation in 1948. Declined living conditions, a lack of trust in the BMA government and, in some cases, resentment over the return of colonial rule, created a situation of increasing discontent and there was a corresponding rise in trade unionism and political unrest. ⁹ While this was not specific to the postwar era, the circumstances of war had exacerbated many socio-economic and political tensions.

Although unrest was rife across all sectors, there was a concentration on rubber estates. This was in part due to the sheer numbers of workforce that this industry employed but also the high number of Tamil and Chinese workers, many of whom had been motivated by the Indian independence movement or the Chinese Communist Party under Mao Zedong. Strikes began in 1947, ostensibly over working conditions and low pay, with the MCP acting to ferment dissension through trade union organisations and schools. The MCP had been founded in 1930 but had risen to greater prominence during the Japanese Occupation. During these years, a splinter group of the MCP known as the Malayan People's Anti-Japanese Army had taken to the jungle to wage an undercover war against Japanese forces premised on guerilla tactics, often in concert with, or with the tacit support of, British authorities. When the Japanese surrendered in 1945, some elements of the MCP began, in the words of Christopher Bayly and Tim Harper, to acquire a ‘public personality’ in Malayan politics. Despite assurances from MCP leader Lai Teck that the party would not use force against the British government, certain quarters of the MCP had become radicalised through Labour Unionisation and the generally poor living conditions in the difficult postwar years. ¹⁰

By 1947, leadership of the MCP had passed to Chin Peng and, under his guidance, the party became more aligned with the Chinese Communist Party. Even before the Second World War had ended, several British operatives in Malaya had warned the government of the potential of the jungle-based communist guerillas. Having in many cases amassed extensive knowledge of jungle warfare, secret bases and ammunitions dumps, there were fears that these could be turned against the returning British colonists. But, with the government largely brushing aside such concerns during postwar reconstruction and shortages of almost everything including food, an investigation had not been prioritised even despite an uptick in violence across the country in early 1948. For the MCP, the rubber plantations were symbolic of British rule. Despite the prevalence of large Chinese owned or run estates or, the dominance of Asian smallholders in the Malayan rubber economy – a fact that distinguishes the Malayan rubber industry from that of plantations economies elsewhere, including in Africa or the Philippines – the London-based agency-houses and large corporations running plantations in Malaya were the epitome of colonialism and the antithesis of the communist agenda then emanating from China. ¹¹

After the murders of mid-1948, The Planter journal's editorial decried the government's efforts in curbing the outbreaks of violence then affecting the industry. ‘The planter, together with the miner, has been in the Front Line now for over six weeks and it is elementary to say that they must be relieved. In fact, we would go so far as to say such the planter's position is now not so much in the Front Line, as in No Man's Land … Rubber and tin exports, already dwindling, will fall to an alarmingly low level unless the planters and miners are allowed to go about their work … without having to act as their own estate guards’. ¹² Over the following months, as more murders and violent attacks ensued, estates were issued with rifles, munitions and supplies, such as lighting, to illuminate dark roadways and estate housing. ¹³ A wry cartoon issued in The Planter in October that year noted that the fall in output for August that year was due to ‘normal seasonal resting’ accompanied by an ironic cartoon image of two armed planters and two guards in prone position waiting to fire at jungle marauders intent on attacking their estate. ¹⁴ By the end of that year alone, 15 estate managers or assistants had been killed. ¹⁵

While this mayhem was happening on the ground, the transfer of power to India in 1947 saw Malaya rise to a new position of global importance. The Malayan economy was now at the heart of Britain's Far Eastern revenue generation and both Britain and America also viewed the nation as of critical tactical importance to their ‘Great Power ambitions’. ¹⁶ The American position had been aptly summed up in 1945, when American Acting Secretary of State Joseph Grew wrote to Secretary of War Henry L. Stimson with a policy paper on the probable postwar situation in Malaya. Malaya was of critical strategic importance – the paper noted – due to the reliance of American industry on natural rubber imports from that country but he warned that severe dislocation of this resource should be expected for the immediate future. Many Chinese in the colony, the paper further predicted, would look to the Kuomintang and Chinese Government for support against the British authorities and, that the US policy in such circumstances should be one of non-interference. ¹⁷ Yet, given the strategic importance of rubber to the United States, non-interference was not exactly an option. When the Emergency was declared, Malaya was one of the last remaining strategic military outposts in British-held territories in Asia, following the decolonisation of India and Burma, and was centre-stage for the emergent communist threat in Southeast Asia. As Karl Hack has argued, the ‘Malayan Emergency was a local branch of the Asian Cold War, which was in turn a Moscow-directed extension of the Western Cold War’. ¹⁸ American policy therefore could not afford to ignore Malaya, economically or politically.

Whoever had control of rubber meant the control of a strategic commodity used in military campaigns as well as its importance to burgeoning domestic manufacturing economies. As United States, Britain, Germany, France, Canada and the Soviet Union were the largest world buyers, the emergence of Cold War tensions however meant that the USA sought to manage Soviet ambitions by limiting their ability to buy rubber from Malaya – by now the world's biggest producer – to countries within the Soviet Bloc. ¹⁹ They had requested the British government to ban or curtail Malayan rubber exports to Russia and the entire Soviet Bloc from as early as 1945 but, ongoing British unwillingness amidst rebuilding their industry lead to a non-agreement. ²⁰

The British authorities, while broadly in agreement politically speaking, were not keen to take the hit to their revenues, at least not without concessions. Russia had been a long-term importer of Malayan rubber. Despite a hiatus around 1917 to 1921, the period of the Russian Revolution, their rubber imports had grown steadily. As the Soviet Union, imports had reached around 30,000 long tonnes per year by 1939, but this figure had more than doubled after 1948, even despite further development of their own synthetic industry and, it was British Malaya who were supplying much of this rubber. ²¹ In the first 5 months of 1948, for instance, Malayan exports to Russia amounted to around 20,000 tonnes, with a further 9000 tonnes shipped in June alone. ²² British records on the matter make it clear that the British government's response to the United States’ demand to cease supplying the USSR was muted, suspicious even. An international control agreement benefited the USA because it meant that natural rubber could not flood the domestic synthetic market which the Americans had invested in during the Second World War. Freely available natural rubber would have pushed down prices and, importantly, demand for the lower-grade synthetic product. That said, the Americans were also not prepared to compromise by gearing their synthetic rubber production to natural rubber availability, something that the British wanted in return for limiting or stopping exports to the Soviet Bloc. ²³

In 1949, however, the American government revisited their call, in light of new information that Russians were generating stockpiles of the natural commodity, which smelled suspiciously like a prelude to war. ‘If some preventive action is not taken’ Washington was to report, ‘the Soviets are likely to have by the end of 1949 a strategic stockpile sufficient to support consumption for over two years’. The British government had requested a compromise that suited them better – that the USA increase their rubber consumption to limit the amount of natural rubber in global supply – but the American's preferred to ‘reach understandings with the producing countries in order to limit their shipments to the USSR’. ²⁴ Their stance was in light of US Central Intelligence Agency (CIA) reports that warned how war with the USSR was imminent. In this event, the main object of the USA would be to destroy ‘the other's war-making potential. The Far East … while not seemingly of vital importance … will [thus] develop increasing strategic significance’. If the USSR were to gain control of Far Eastern resources, this could even prove decisive in the event of a prolonged war, they argued. Further, Malaya, despite British rule, was considered an area of ‘mixed orientation in which conflict between European colonial control and Far Eastern nationalism’ would undermine their potential to support the USA in their war. Loosing access to Malayan rubber was one of the US’ greatest fears. Although they were better prepared than they had been at the outbreak of the Second World War, having scaled up production of their synthetic alternative after Malaya and Indonesia had fallen to the Japanese, their synthetic industry was nowhere near ready to produce enough rubber to manage if the Southeast Asian supply was blocked for a long period. The USA would need to defer war until at least late 1952 the CIA had argued, to allow enough time to stockpile enough rubber supplies. Even then, it would depend on the persistence of the broken supply line as to how long they could manage. ²⁵ This message was reiterated the following year by the US Secretary of Defense George Marshal. If the security of Sarawak, North Borneo and Malaya are threatened, he had argued, then so will be our sources of supply of critical raw materials such as rubber and tin. ²⁶

However, while the British were sympathetic, they were not entirely willing to bend to American demands. They had their own interests to consider. In February 1950, American Ambassador at Large, Philip C. Jessup was hosted by Malcolm MacDonald, the United Kingdom's Commissioner General for Southeast Asia, at the latter's house in Johore, southern Malaya. Here, along with several other American and British officials, they discussed the Far Eastern situation over tea and dinner. McDonald was ambivalent about the ongoing communist threat in Malaya, suggesting that Indochina and Burma were far worse affected. That said, if either of those country's was to fall to the communists, Malaya would be a clear target and, thus it was down to Malaya to hold the fort for Southeast Asia. An additional supply problem was the regional linked issue of food security. In the event that Burma, Indonesia or Thailand fell into hostile hands, it would affect Malaya's rice supply, as these three countries were Malaya's main suppliers of the basic foodstuff. If the rice supply chain broke down, it would prove disastrous to the Malayan estate labour force and smallholders for whom rice was a staple. Jessup and McDonald further discussed how they might cooperate in creating a rice trade between the USA and Malaya, but the British Commissioner was not open discussing Jessup's suggestion that they lower the price of rubber in exchange for the rice agreement, arguing that a price decline would have a disastrous impact on the local economy, a fact that would be inconceivable during their present troubles. ²⁷ The question of lowering the price of Malayan rubber for American buyers was however directly linked to America's ability to stockpile for the predicted war with the Soviet Union.

In general, Malayan rubber traders sided with the British government, arguing that America had ‘not been buying sufficient rubber from Malaya to justify this country backing her demand that no rubber should go to Communist countries’ and, that unless the US buyers were prepared to pay a better price, Britain would have no choice but to ‘sell behind the Iron Curtain’. ²⁸ ‘It would seem that the future of the rubber industry … largely depends on America's willingness to cut down on synthetics, and on the willingness of all our customers to go on stockpiling’, the London Correspondent to the Malaya Tribune opined in 1951. It was highly unlikely that America would commit an act of charity towards Malaya, the correspondent continued and, they would be justified in not doing so, given the lesson of the Japanese Occupation when ‘she found her main sources of rubber cut off almost overnight … How then can she be expected to neglect her growing synthetic industry merely to do Malaya a good turn?’. ²⁹ The Malayan trade unions agreed. In 1952, G. K. Kathiravalu, Asian Staff Union President at the Negri Sembilan estate, for example, blamed the United States for falling rubber prices. ‘While the American Government has declared its support for the countries of South-East Asia in their fight against Communism, its action in trying to cut down unduly the price of a commodity essential for Malaya's prosperity is bewildering’, he argued at the Union's Annual General Meeting. ‘The Americans have not played a fair game. The British Government should seriously consider lifting the restrictions on the sale of Malayan rubber to banned countries’ he continued. ³⁰ Yet, there was another side to this story and one that did not focus on pure economics but on political allegiance.

It might be considered that the USA would have reacted severely to this but, there were other competing interests at stake. During an ambassadorial visit to Malaya in 1951, for example, Warren Lockwood, head of the US Natural Rubber Bureau in Washington, highlighted how it was vital that American buyers continued to support Malayan rubber producers so as not to put the industry out of business. His proclamation was made in the wider spirit of the fight against communist interests in Southeast Asia. For ‘if the tower of strength in Malaya should fail, a South-East Asia will fail’ he claimed. ‘Malaya is holding back Communist pressure on a front extending from Indo-China across South-East Asia with more men, money and morale than America has even begun to realise’, specifically referring the ongoing violence centred on estates. ³¹ F. D. Ascoli, Managing Director of Dunlop's rubber plantations in Malaya also warned in 1949, that Communism in Asia could not be fought without maintaining prosperity in rubber-producing regions. For this purpose, it was essential that America made a guarantee of purchase, he went on. ³² The double standard that was seen to be protecting American interests in their own synthetic industry while trying to enforce embargos on Malayan exports was not lost on contemporaries who jibed at the perceived hypocrisy. ‘It is not about time that we realised that the mighty Uncle Sam kept his political sentiments and his wallet in different pockets?’ asked the Singapore Standard in 1952. ³³

The Malayan rubber industry was facing a crisis. Competition and continuing US restrictions combined with the outbreak of violence on estates as a new financial burden. As early as April 1948, even before the killings at Sungei Siput had taken the planting community by storm, the minutes of the Selangor Branch meeting of the International Society of Planters had deprecated what they saw as the ‘unpreparedness of Government … to cope with the present terrorist activities … there is a deficiency in security measures and up-to-date equipment, notably in the direction of wireless, police patrol cars, and supplies of efficient arms’. ³⁴ From 18 June 1948, the whole Federation came under Emergency ruling, essentially a state of martial law. Police, and the Malay and the Gurkha Regiments were allied to undertake extensive patrols on the estates and to sweep the jungle for suspected terrorist hideouts. ³⁵ But this was still not enough. By 1950, the number of deaths had increased so much that by November of that year, The Planter was issuing a monthly Roll of Honour, to memorialise all (European) deaths in the planting community as a result of the Emergency. ³⁶ Managers and estate workers were suffering from the emotional strain of continued violence and many estates were forced to dip into their own pockets to finance the costs of the war on the ground.

Rubber estates were generally bordered by fences or by watercourses, more to keep out animals or to demarcate boundaries, than to keep out people. Sprawling in many cases over hundreds of acres of land, the estate roads that crisscrossed the plantations could be isolated and easy to ambush, as also the living quarters of the tappers, estate managers, assistants and their families. The experience at Melvilla Estate in northern Johore was commonplace, where defence posts, floodlighting and fencing had to be erected, armoured vehicles replaced ordinary estate lorries and cars, and special guards had to be employed. This was especially the case for the transport of cash on worker's paydays, as the vehicles were easy targets for bandits who sought to requisition the money for their own purposes. ³⁷ Normal routines had to be changed up regularly and estates took out additional insurance, not just to replace damaged stock or materials but to provide for injured estate workers and their families if they were harmed or killed on the job. At Yong Peng estate – also in Johore – 1 year of action saw 12 murders, 20 vehicles robbed or burned, 39,732 rubber trees damaged with knives and 36 vehicles ambushed. ³⁸ At the Guthrie-owned Kamuning estate in Perak, close to the Sungei Siput estate, losses amounting to $750,000 Straits dollars were reported within just a few months due to damages. The staff lived ‘in constant danger of their lives, and our property is liable to attack at any time’ remarked Sir John Hay, Chairman of the Guthrie Company in 1948. ‘An industry such as ours, still struggling to recover from the disasters of war and working on a narrow margin of profit, can ill afford to carry these additional burdens’ he continued. ³⁹

That this ferment elicited a culture of fear and distrust was apparent in the complexity of relations between the British and the Malay and Chinese populations, not simply in a binary of anti-communist or pro-communist sentiment. In 1949, for example, it was noted that many among the Chinese population – even those who wished ultimately for decolonisation – that the Emergency might prompt the British to leave too soon, leaving the country in turmoil. This possibility, it was thought, may well end up with Chinese people targeted by terrorists for collaborating with the British government and military in providing information or support in putting down the threat. Likewise, leading Malay member of the Federal Legislative Council Hussein bin Onn, warned that there was increasing dissident talk in the rural areas from Malay villagers who believed that the government's expensive and all-encompassing pursuance of terrorists was to the exclusion of all else. This single-mindedness was, in their eyes, far too benevolent towards what Onn referred to as ‘aliens’, essentially non-Malayans who were thought to be assisting the terrorist activities and, impacting on policy and expenditure in other areas important to the rural populace. ⁴⁰ There were even voices in the British parliament who felt that less money should be sent from London and more taken from the pocket of the ‘commercial’ class, comprising Chinese and British estate and mine owners, for fighting the war, a call that was thought to be inspired more by winning the next (British) election, not the war in Malaya. ⁴¹

A telling report of the state of the industry was published in 1954. Known colloquially as the Mudie Report, it was the result of an independent investigation commissioned by the Federation of Malaya government and the Rubber Producer's Council and it was greeted with mixed feelings by the Malayan planting community. ⁴² The report was written during two tours of Malaya. It emphasised taxation in relation to the costs of production, replanting, the marketing and processing of smallholder's rubber and, means of managing unemployment. The ongoing Emergency was at the root of many of the issues that the report raised, not least, the difficulty of replanting while the estates were under siege and their monies diverted to counter-terrorism activities. The area replanted between 1931 and 1941 was now ‘at its peak’ the report noted but, if nothing were done, this ‘will soon start to decline, [while] the production of the remaining … 75 per cent of the total planted area is already declining’. In real terms, this trend was predicted to equate to a decrease in production of around 140 thousand tonnes of output within 10 years. The idea behind replanting was simple: to increase the latex yield of the tree by a form of selective breeding of chosen high-yielding plants. However, rather than adopting their seed – the variability from this method was still too high – bud grafting was instead used. This was a method of taking a bud from one high-yielding tree and grafting it onto a seedling plant. The plant is then cut off just above the grafted bud and the stump continues to grow into a new tree, known as a bud graft. ⁴³ The benefits of replanting with these newer plants were clear to Malayan producers from historical yield data. In the 1920s, for example, the annual yield from estates was around 100 pounds per acre but, by 1941, the yield from estates replanted with higher yielding bud grafts or clones had risen to 1000 pounds per acre. ⁴⁴

Under normal circumstances, the ideal latex-producing lifespan of a rubber tree is around 25 to 30 years, thus, trees that had been planted during the initial boom years of the early 1900s needed replacement at the time when research on bud grafting and cloning was coming into its own in the 1930s. But while many large estates had begun replanting projects in the mid-to-late 1930s, the Second World War had intervened in their progress. By the time that replanting was resuming in late 1945 or early 1946, estates that had not previously replanted or, those that had suffered damage during the war, were seriously behind schedule. With war reparations for the latter not being realised until after 1948, the Emergency was already well underway before replanting picked up speed. ⁴⁵ This was considered an especial problem for the smallholdings, at least half of which had last been planted more than 30 years back. ⁴⁶

In 1953, smallholders owned collectively around 1,706,000 acres of land in Malaya which was around 45 per cent of total rubber acreage. This amounted to a substantial proportion of total rubber output, management of which lay outside of the direct control of the Malayan rubber organisations or government. Yet, their inability (or disinclination) to replant with the higher yielding clonal varietals and bud grafts was thought by some to be holding back the transition towards a more scientific and productive industry. ⁴⁷ It was identified that, for replanting to take place, a significant investment in heavy manual labour and an initial outlay of capital would be needed for each holding. This might be realistic for large estate operations that had the financial backing of an agency house but was out of scope for small family-run plantations. As the Report had noted, estate production was ‘static’ but smallholder production was ‘elastic’. ⁴⁸ H. C. Bugbee, Associate Director of the Natural Rubber Bureau, had already noted in 1952 that most smallholders could not afford to have a drop in income for the 7 years that it took for a new tree to become productive. With the average smallholding about 4 acres in size, and the cost of living having risen more than 50 per cent since 1940, it was impossible to expect a family-run smallholding to take even a small percentage drop in income for such a long period. ⁴⁹ Thus it was no surprise that just before the Second World War only around 435,370 acres of estate lands had been replanted with bud grafts or clonal seedlings (about 20 per cent), whereas less than 1 per cent of smallholding lands had made the transition. ⁵⁰

The smallholding community had conterminously been hit by the extension of postwar US government controls on the free competition (not private trading) of natural rubber with its synthetic counterpart, designed to protect their own synthetics industry. ‘It is strange that on the one hand the USA is handing out countless dollars to fight Communism and preserve the free way of living’, while on the other, she ferments unrest by applying controls remarked T. J. Lim, Market Reporter for the Singapore Standard; ‘what a magnificent opportunity for Communist propaganda’. ⁵¹ It was also a concern for smallholders that by initiating so-called improvements, Malaya would be ‘playing into the hands of America who was out to depress the price of Malayan rubber’ and, likewise, that the higher quality latex produced would ‘kill the market for lower grade rubber’: the type that prevailed on the smaller estates. ⁵² If the US government continued to suppress prices for the commodity, many officials were concerned that the resultant depression and unemployment in smallholdings would play straight into enemy hands and, indeed, there were reports that the Chinese government were reaching out to smallholders in Southeast Asia, taking advantage of the American restrictions to gain support among rural communities by offering to buy up their lower grade rubber. ⁵³ Indeed, were it not for two events of the 1950s, the industry would likely have been in an even worse state. The first was the advent of the Brigg's Plan from 1950 and, the second, the outbreak of the Korean War that same year.

The Brigg's Plan was a combined military and civilian strategy named after its instigator General Sir Harold Briggs after his appointment as Director of Operations for the Emergency. The Brigg's Plan was not an immediate panacea, but its effects had begun to be felt on easing localised violence on estates from 1952. ⁵⁴ Functioning on the basis of distancing jungle-based insurgents from essential supplies, as well as pursuing military operations into deep jungle, it combined civil and military efforts to destroy and prevent a resurgence of activities. ⁵⁵ But it was the advent of Korean War that made the most difference, providing the market surge and the revenue to enable the Brigg's Plan as well as rejuvenate the industry and provide the monies for the replanting schemes.

In 1950, Malaya's balance of profit amounted to almost one and a half billion Malayan dollars more than in 1949, much of which was attributed to the wartime boost to the rubber and tin industries. ⁵⁶ Mr H. B. Egmont Hake, Chairman of the Rubber Growers’ Association noted at their annual meeting for 1950 how the war had provided a ‘remarkable overnight change’ in the Malayan rubber industry's fortunes, though a rise in rubber prices in combination with increased demand. Chairman of the British Rubber Growers’ Association Mr P. B. L. Coghlan, had a similar view and went so far as to admonish the US manufacturing industry in 1951 for having suggested that they ‘could, at a pinch, manage without natural rubber’. ⁵⁷ The financial boost to the Malayan, and thus colonial, economy resulted in the suspension of the US Marshall Plan of foreign economic aid to Britain in effect since 1948, designed to enable Western European countries to stabilise and rebuild following the end of the Second World War as a counter to communist infiltration in that region. ⁵⁸

Yet, the Korean War's boost to the Malayan economy, while bringing back prosperity to some also contributed to a dangerous rise in inflation as the country turned its production once more from peace to wartime production. A corresponding rise in prices and scarcity of consumer goods contributed to a rise in living costs in Malaya, with the greatest impacts on the smallholders and workers, those who did not directly benefit from the better rubber prices. ⁵⁹ Even for the larger estates, there was anecdotal evidence that a concerning number of European-owned estates were being sold and their activities being transferred elsewhere, reflecting a lack of market confidence. ⁶⁰ Certainly, this was not misplaced, as the economic injection into the market was to be short-lived ending with the cessation of the war in 1953. ⁶¹

The Mudie Report, therefore, was a direct reflection on the industry under these conditions. In the wake of the report, the government detailed proposals under which $280m would be allocated from government revenues over a period of 11 years to assist the industry to re-or new plant at a value of $168m for estates and $112m for smallholdings. The government replanting scheme for large estates (considered over 100 acres) came fully into operation during 1956. ⁶² As a result, by the end of 1956 1.2 million acres out of a total 3.5 million acres of estate rubber (or 34 per cent) were under high-yielding strains. ⁶³ Not all smallholders were keen to take up the funding though. There was resistance by unions and by nascent political groups, including the Pan-Malayan Labour Party (formed by the amalgamation of state labour parties in 1950), who felt that the government push to replant was in the interests of the big estates and their own revenues, not the small landowners. For example, the government's proposed plan to channel all rubber through official collecting centres, removing smallholder's right to an internal free market was symbolic, they argued, of ‘rubber nationalisation’. ⁶⁴

Trade unions representing the rubber industry were simultaneously fighting another battle for better wages, especially due to the post-Korean War depression in 1953. ‘More than 300,000 workers in the rubber-fields, where communist agents are active, are affected by a cut, the second this year, in their wages as the result of a compromise arbitration award’, Frederick W. Dalley, advisor to the Secretary of State for the Colonies on trade unions and labour wrote. ⁶⁵ Wage levels for estate workers were traditionally linked to the price of rubber and the arbitration in question had fixed wage rates, provided that the price did not fall below 65 cents. However, in 1953, this eventuality did occur, leading to an urgent need to renegotiate. P. P. Narayanan, General Secretary for the Pan-Malayan Rubber Workers’ Trade Union, met with Sir Sidney Palmer, President of the United Planting Association of Malaya in London where they discussed how the attitude of some employers in not accepting trade unionism was driving workers ‘into the hands of extremists’. Discussions also centred on the inclusion of Chinese and Malays into the estate workers unions which, currently, were dominated by Indian workforces, yet understood that this would likely be difficult as the Chinese in particular did not feel that negotiation was undertaken through unions, but directly. Other rumours and direct threats abounded that estates had been threatened with strikes – financed ‘from abroad’ – and that ‘steps would be taken to prevent the handling of Malayan rubber being exported [and] from being landed in the more important countries where it is required’. ⁶⁶ This direct threat to US and British interests suggested strongly that the majority-Indian led unions had lost the support of the Chinese workforces which, it was discussed, was largely due to the poor machinery of the unions as currently realised. ⁶⁷ The Malayan industry was thus fighting a battle on multiple fronts: local and international, political and economic, scientific and ideological.

As well as the new government-funded replanting schemes initiated by the Mudie Report and suggestions to revitalise the trades’ union structure to improve industrial relations and as a means of ‘developing a democratic way of life’, the Malayan Rubber Growers Association (RGA) also decided that pro-Malayan rubber propaganda needed to be stepped up, at home, and abroad. ⁶⁸ Marketing and propaganda had taken place under the official auspices of the RGA's Propaganda Committee from 1921 but, after 1948, their efforts became deeply interconnected with the ongoing Emergency. From 1949, special sub-projects were sponsored by the British Rubber Development Board and the Rubber Producers’ Council who focused on appealing to an American market. Everyone already knew that rubber had multiple uses, but the industry was hoping for a magic bullet of the kind that the nascent motor vehicle industry of the 1910s had provided. Rubber roads were thought to be it. ⁶⁹ Mixing rubber powder into asphalt had been found to make roads less liable to the type of seasonal cracking experienced in roads in the Northern Hemisphere and, with the US transportation sector still Malaya's biggest buyer, pushing into road development was expected to keep American demand for Malayan rubber high. ⁷⁰ This venture had the backing of heavy weights of the Malayan industry, such as Sir John Hay, Chairman of the RGA and head of Guthrie & Co. who believed that persuading the Americans to continue to buy Malayan natural rubber would help desist the looming threat of synthetic competition. ⁷¹ Indeed, early experimentation with rubber roads in the USA – especially Ohio, the heart of American rubber manufacturing – had been so successful that even a reluctant Malayan Public Works Department began introducing rubberised surfaces for their own urban roads from the early 1950s. ⁷²

Malayan propaganda during the 1950s also capitalised on the Emergency, to try to win the hearts and minds of the American public. In 1952, for instance, more than 160 thousand pounds was spent on targeted American advertising, which included a publicity stunt to showcase rubber roads. Much of this advertising had a political message. Arranged by the Natural Rubber Bureau, this particular stunt focused on educating the American buyer and public that most of their natural rubber supplies were produced by Southeast Asian countries with at least 40 per cent from Malaya: ‘America's ally in the fight against Communism’. ⁷³ Sponsored by a 5-year grant from the Malayan Rubber Fund, which was financed through a cess on rubber, this was part of an awareness raising campaign to bring ‘the story of rubber and Malaya was brought right into the homes of Americans in the multimillions’ and to raise ‘public appreciation of rubber, Malaya, Southeast Asia and the fight against Communism’ in that country. ⁷⁴ ‘There is no doubt’ it was remarked in 1952 that the campaign was a success. ‘[T]he number of newsmen normally reluctant to give space to any place as remote as Malaya are now doing so because their interest has been fired by the [Natural Rubber] Bureau’ stated Rhona Connery the face of the US campaign. ‘[W]herever I go, I hear the same comment: “We didn’t know they were fighting Communists like that [and] we would like to hear more about it”’. ⁷⁵ Likewise, Dr Dennis J. Duncanson, Private Secretary to the British Governor who was involved in a Malayan government sponsored lecture tour to American universities and state colleges two years later, was optimistic that Americans would not boycott Malayan natural rubber in favour of American synthetic alternatives on the grounds of American nationalism and anti-colonial feeling. ⁷⁶ While the propaganda was no doubt effective in some small way, the reality was that the USA continued to be one the world's largest buyer of the natural product and so, could not in reality ignore the Malayan industry, especially at a time of decolonisation and uncertainty for the economic development of the country. It is no surprise that their close relationship and provision of economic aid to Malaysia following independence was part of their developmental discourse in Southeast Asia. ⁷⁷

In 1950, Edward Jago, Deputy Chairman of the British Rubber Development Board, had predicted that within the next decade the USA would use more than seven times the amount of rubber for their road network expansion and was confident that Ceylon, Malaya and Indonesia were working together to secure the future of the Southeast Asian industry. Jago had reason to be optimistic but also, as a leader of one of the industry's propaganda machines, also had vested interest in putting out a positive message. ⁷⁸ The reality was that although the industry on the whole rallied with production on a gradual increase between 1950 and 1960, many events of the 1950s had resulted in increased industry uncertainty, higher expenditure and, in some instances, lower returns. The Korean War moved the cost of the Emergency expenditure from the colonial government to the rubber industry, on grounds that they could now afford it. Taxes were imposed not only on profits but on outputs. ⁷⁹

The Second World War had changed the balance of geopolitical power which, for the Malayan rubber industry meant that they no longer had the upper hand in dictating global supply regulations and direction. The Cold War had added new dimensions to the industry, by politicising supply chains and placing plantations themselves at risk, literally and financially. The situation on the estates and smallholdings was complicated by communist activities on the ground or, the perceived threat of Communism as it was understood by the US government. Much of the situation was blamed on the American government for imposing, and then not relieving, steep supply restrictions to protect their own synthetic industry and stockpiles. Although the Korean War ended some of these, provided an immediate injection of energy to the industry and, the much-needed revenue to put in place many of the strategies to quell terrorist activities on the ground, the more far-reaching consequences of the resettlement portion of the Brigg's Plan and the move towards supporting smallholdings and rural development were what D. J. Tate describes as an ‘irreversible move toward Malayan statehood and independence’. ⁸⁰

The rubber industry was not, of course, the heart of the movement towards decolonisation, reasons for which were far beyond the scope of this article. Yet, the industry in the 1950s reflected the new world order that had emerged most forcefully after the Second World War and, symbol and site in the war over communist interests. That overall world rubber absorption would continue to increase, driven in the main by the United States but, in no small part, by consumption and production of synthetics in countries behind the Iron Curtain was also a new reality. ⁸¹ It is somewhat ironic that despite this pushback during the 1950s, today China is one of the largest buyers for Malaysian rubber, with the USA buying predominantly from Thailand, Indonesia and Africa.