Malaysia rubber gloves industry is facing cost pressures

According to the "Nanyang Siang Pau" on September 21 reported that despite the latex prices, electricity prices are brewing, so that domestic manufacturers of plastic gloves in the face of the double pressure of rising costs, it is believed that gloves in the field of the overall impact .

International crude oil prices soared, only to follow a corresponding rise in latex prices, but also led to the need to increase the price of natural gas in order to reduce the subsidy costs.

Market participants are worried that once the gas price increase, the state energy (Tenaga, 5347, Bhd) will be forced to increase electricity tariffs, resulting in the production costs of plastic gloves risen further.

Additional costs to the general customer

But analysts believe that this is Malaysia's glove manufacturers is not affected because the rubber gloves manufacturers can pass on the cost of additional customers.

Securities houses made up of a report that Malaysian rubber trees in the fourth quarter due to wet weather which led to reduced production of latex, which resulted in latex prices. Therefore, the securities are not accidents, the current latex price was rising.

For this reason, securities firms reached the view that the rise of the price of latex gloves manufacturer in Malaysia, will only "and".

Securities firms also believe that the Malaysian glove manufacturers have to adapt to fluctuations in the price of latex, so the situation for them, but also not much different.

R & D durable thinner gloves

In the past, Malaysian glove manufacturers have been successfully passed on 7-10 percent of the cost of latex to its customers. Some companies have even up to 6-12 on the futures to lock the price of latex.

In addition, Malaysian glove manufacturers are also continuing to develop thinner and durable gloves, latex on the market to reduce dependency.

Securities firms also pointed out that although the Tokyo rubber futures have now started to provide a market for the latex to support the pipeline, but Malaysia is not yet a similar derivatives.