KUALA LUMPUR (Dec 4): Local glove manufacturers will tweak their prices to match up with rising cost, according to Malaysian Rubber Glove Manufacturers Association (MARGMA) president Denis Low Jau Foo.

In a statement today, Low said this was in the wake of the steep rise in natural gas price, the escalating cost of the packaging materials, the weakening of the US dollar (USD), higher chemical cost and the annual incremental cost relating to wages and the new governmental policies.

“We are making this statement early, so that all stakeholders can be prepared to expect higher glove prices in the months ahead as it is inevitable, and that such incremental cost would have to be passed on to buyers, as it would be difficult for the manufacturers to bear,” Low said.

The steep rise in the natural gas price of about 22.9% will mean an additional cost of about 60 cents to US$1, depending on the glove type, Low said.

“MARGMA can understand the gradual subsidy removal by the Government as part of its subsidy rationalisation program, but still, a 22.9% increase is rather steep, as we need to be mindful of competition from our neighbours,” Low added.

He said escalating cost of packaging material was mainly due to a sheer lack of recyclable material, as readership of newspapers and magazines has dwindled at an alarming rate, worldwide.

He said this shortage of recyclable material will continue in the months ahead, thus pushing up the price of boxes.

“This year alone has seen prices moving up thrice, culminating to date, an increase in price by about 32%.

“This will mean an additional cost of about 20 to 30 cents per carton of 1,000pcs of gloves, depending on box type,” Low added.

Since the USD is expected to be weaker against the ringgit as oil prices soar and in the months ahead, MARGMA members need to factor in this element of fluctuating exchange and lock in the rates to secure their margins, Low said.

“We believe this is something which the glove manufacturers are very adept at,” he said.

On another note, Low said it was going to be a record year for glove manufacturers, as world-wide demand for medical and surgical gloves was extraordinary, with all manufacturers running at optimum capacities and at an oversold position.

“This is brought on mainly by acute healthcare consciousness, regulatory requirement to wear gloves in developed and developing nations, and the crack-down of vinyl glove factories in China due to environmental issues.

“Malaysia stands to reap in RM16.2 billion in revenue this year, having achieved RM7.95 billion in the first six months,” Low said.