Rubber glove stocks rocket after COVID-19 pandemic declaration

Rubber glove manufacturers have seen increased demand since the World Health Organization declared the COVID-19 outbreak a pandemic – gains were reflected in rubber glove stocks, including Malaysian rubber glove manufacturers such as Top Glove, Hartalega Holdings, Kossan Rubber Industries, and Supermax. Top Glove saw its share price rise 23 sen to close at RM6.51 while the others rose 1.39% to RM6.57, 3.52% to RM5.30 and 2.31% to RM1.77, respectively.

President Denis Low, Malaysian Rubber Glove Manufacturers Association (MARGMA) thinks demand will escalate further – the COVID-19 outbreak could bump up demand to exceed 340 billion pieces annually as the virus responsible appears to spread very quickly. MARGMA previously estimated the world’s requirement for both natural and synthetic rubber gloves to be about 320 billion pieces annually; during the H1N1 outbreak, demand for gloves increased by 17%.

As such, depending on the spread/duration of the COVID-19 outbreak MARGMA is expected to deliver upwards of 220 billion pieces of rubber gloves. Fortunately, this would allow the association to achieve RM21.8billionin revenue this year. Malaysia exported about 185 billion pieces of rubber gloves to gain RM18.2billion in 2019.

According to Low, MARGMA members were recently asked to “tweak their production lines and run longer hours to ensure sufficient supply of medical gloves to affected countries.” Helaments that the industry is hampered by a shortage of workers; manufacturers also have to heed unreasonable working hour requirements and limitations imposed on overtime work.However, he added that the industry could benefit from the “conducive exchange rates” as the US dollar had strengthened against the ringgit.

“Having to comply with certain standards is a major challenge during this period; hopefully, the lower oil price will augur well for our logistics and other costs to offset against the increased cost of wages,” Low said.