Rubber glove makers ramp up production as demand surges due to virus

The coronavirus outbreak has stoked the need for select healthcare products and driven investors into shares of glove makers

As Malaysia officially announced the identification of persons with the Wuhan coronavirus infection in the country, local rubber glove producers have ramped up production to meet an uptick in demand.

The outbreak continues to infect hundreds and claim lives across major cities globally, especially in China.

The Malaysian Rubber Glove Manufacturers Association (Margma) last Friday said its members are prepared to gear up production to meet “astronomical” demand should the pneumonia-like illness turn pandemic.

“While we may be having a shortage of workers and the fact that we cannot have more overtime, the industry will then have to tweak the production lines to run at optimum levels, to churn out the medical gloves to supply to the world,” president Dennis Low said in a statement.

Drawing lessons from the spread of the H1N1 virus — which witnessed a 17% increase in medical glove consumption then — Low said the industry is prepared to increase production to facilitate humanitarian services in the healthcare sector.

“We hope and pray the virus can be contained and will not spread as quickly as the H1N1. However, if the situation warrants it, we will be ready and will be able to provide enough medical gloves to the world,” he said.

The outbreak of the virus from China has stoked demands for select healthcare products and driven investors into the shares of glove makers like Top Glove Corp Bhd — the world’s largest rubber glove producer — whose’ shares have rallied to a year high of RM5.54 last Friday.

Peers like Kossan Rubber Industries Bhd, Hartalega Holdings Bhd and Supermax Corp Bhd have also gained as investors bet on higher demand for rubber glove products from across the region to prevent cross-contamination between virus carriers and caregivers.

Kossan’s shares advanced 2.37% or 11 sen to RM4.75 last Friday, while Hartalega was the highest since January last year at RM6.03, up 14 sen or 2.38%. Supermax jumped 5.92% or nine sen to RM1.61 on a shortened trading day ahead of Chinese New Year.

Shares of Duopharma Biotech Bhd — which develops, manufactures and markets generic and branded pharmaceutical products — gained two sen or 1.2% to RM1.69, while Pharmaniaga Bhd — which makes generic versions of influenza antiviral drugs — dipped four sen or 1.89% to RM2.08.

Commenting on the market situation and trends for 2020, Low said the glove industry is expecting a rise in costs on wages, utilities, packaging amid ensuring a conducive working environment for workers.

Separately, Economic Affairs Minister Datuk Seri Mohamed Azmin Ali announced an allocation of RM227 million in 2020 by the government for the purchase of medical and non-medical equipment for all health facilities throughout the country.

“In this regard, the ministry will ensure selected hospitals and health clinics that have been identified for screening of diseases will be adequately equipped in controlling infection, prevention and contact detection in potential areas,” he said in a statement last Friday.

In 2019, the ministry approved the establishment of the National Centre for Disease Control worth an estimated RM500 million to prevent and control diseases, investigate outbreaks and public health threats. This project has been underway and is expected to be completed by 2023.

Source: The Malaysian Reserve 

Posted on : 28 January 2020
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Last Updated : Thursday 21st May 2020