KUALA LUMPUR: Malaysian glove companies are expected to capture a 65% share of the global glove market by 2020, up from 58% currently, said Malaysian Rubber Glove Manufacturers Association (Margma).

Its president Lim Kwee Shyan said this is underpinned by the ongoing capacity expansions by most glove makers in Malaysia.

Malaysia commanded an estimated 62% share of the world market of medical gloves last year, which is equivalent to 112.5 billion pieces.

“We expect a 6% to 8% growth in rubber glove exports this year,” he said during the Margma media roundtable on “Rubber Glove Industry 2015 Outlook” yesterday.

For the first nine months in 2014, Malaysia recorded a 6.4% growth in natural rubber glove exports by volume and 0.3% growth in synthetic rubber gloves exports by volume, compared with figures from a year ago.

Despite the growth in exports, natural rubber gloves’ export value fell 5.9% while synthetic rubber gloves’ export value fell 5.7%.

“The industry experienced a minor dip in average prices for both natural and synthetic rubber gloves due to lower selling prices as an effect of falling raw material prices,” said Lim.

Natural rubber latex price dropped from RM8.89 per kg to RM4.50 per kg in 2014, he noted.

Lim said there is no oversupply of gloves in the global market, adding that “it is a matured market, but the industry will continue to do well”.

The drivers of demand growth of rubber gloves come from the requirements of nursing homes in advanced economies.

“Without support from the Malaysian government, we can’t achieve our target… They have to provide the basic infrastructure for us to compete in the international market,” said Lim.

Meanwhile, Lim noted there was a shift in the demand ratio of natural rubber and synthetic rubber gloves from 49:51 in 2013 to 53:47 in 2014. However, this is not expected to be the trend moving forward.

Supermax Corp Bhd executive chairman and group managing director Datuk Seri Stanley Thai said the shift was caused by the drop in latex price last year.

Thai also anticipates that lower margin pressure in 2015 due to cost reduction on the back of a drop of crude oil prices.

“The ratio [of natural rubber and synthetic rubber gloves] will eventually be at 55:45, moving forward,” added Thai.

This article first appeared in The Edge Financial Daily, on February 12, 2015.