Rubber gloves players may see an increase in demand following the first confirmed case of Ebola outside of Africa.
According to historical epidemics episodes, analysts at MIDF Amanah Investment Bank Bhd (MIDF Research) said the surge in demand for rubber gloves usually occurs before an epidemic.
This is due to the belief that health providers will stock up on gloves as a preventive measure when dealing with the disease.
“Enquiries have been pouring in from the largest importers of rubber gloves,” MIDF Research observed.
“Although the US health officials have stated that Ebola will not become an epidemic in the US, there is still a slight possibility that it could spread as it has not been confirmed that anyone who had recent contact with the patient is Ebola-free.
“In addition, our channel checks have indicated that there have been enquiries to our local glove manufacturers regarding their ability to produce gloves if there were to be a sudden surge in demand.”
This was reminiscent of the pattern seen during the H1N1 epidemic in the US in 2008.
“Revenues for players such as Supermax Corporation Bhd and Hartalega Holdings Bhd – which supply mostly nitrile gloves – increased by over 20 per cent quarter on quarter in the third quarter of 2008 when the H1N1 epidemic started in September 2008,” the research house explained, adding that North America is the main export market for the three major local rubber gloves manufacturers.
“Likewise, according to the Malaysian Rubber Export Promotion Council’s report on Malaysia’s rubber product exports for 2012, export to North America is the highest at 30 per cent of total glove exports, followed by Europe and Asean with 24 per cent and 10 per cent respectively.”
The Ebola virus which has killed over 3,300 people in West Africa since its outbreak in March has been reported in the US.
Recently, a man travelling from Liberia to Texas, US has shown symptoms of the Ebola virus after four days of arriving in the US.
This is the first case of Ebola diagnosed in the US and the first strain diagnosed outside of Africa.
Currently, the patient is kept isolated and anyone who has had recent contact with him is being closely watched.
“With the current expansions, it is undeniable that Malaysian glove manufacturers will be able to accommodate the sudden increase in demand,” forewarned MIDF Research.
“There is still headroom to expand production as Hartalega, Kossan Rubber Industries Bhd and Top Glove are currently operating at a utilisation rate of 88 per cent, 85 per cent and 75 per cent respectively.”