Margma warns of up to 12% increase in prices due to Hurricane Irma and other factors

PETALING JAYA: Malaysian Rubber Glove Manufacturers Association (Margma) expects the price of rubber gloves to increase by up to 12% on Hurricane Irma, rising cost of natural rubber latex, the weakening US dollar and shortage of paper.
In a statement released earlier Margma President Denis Low Jau Foo said one of the key contributing factors is Hurricane Irma, which has caused the prices of Butadiene, an important material in the production of Nitrile Latex to soar, as its production has been severely affected.
Natural rubber latex prices have also been affected by speculation as the commodity is highly volatile, especially so with the pending International Tripartite Rubber Council meet of the world's top producers of natural rubber later this month.
"Usually when this happens, prices of rubber tend to increase due to anticipation of price fixing and speculation. As manufacturers, we want natural rubber prices to be stable, and for farmers to be adequately compensated for their work, and not be subjected to unreasonable speculation and profiteering," he said.
Prices also have to be readjusted to reflect the weakening status of the US dollar and the 15% increase in packing material prices due to the shortage of paper.
Margma said as the industry watchdog it is advising its members to raise prices to better reflect rising production cost and to limit the validity date to a shorter period so as not to get caught out in the unpredictability of rubber and Butadiene prices.
With regards to the industry's performance, Low said the demand for rubber gloves in the first 6 months of 2017 have been extremely encouraging with revenue soaring by around 25% to RM8.1 billion from RM6.0 billion in the previous 6 months. Volume has also increased significantly by 15.8% on the back of 8-10% growth usually.
"We expect the second half of the year to be even better as Europe and America are buying very strongly with Asia leading the pack in terms of
consumption. We understand from our members that most of them are in an oversold capacity position with some major players in oversold up to
December," he added.