10.26.20 - Personal Protective Equipment has become a bonanza of absurd proportions. The global economy threw itself into high gear virtually overnight to cash in on the demand for pandemic equipment. One county has stood out among the others raking in billions for its already-dominant position in the rubber glove industry, Malaysia.
It has been a good year for the glove barons of Malaysia, a country that produces about 65% of the world’s supply for rubber gloves, now touts at least four billionaires whose fortunes were made in the industry, including two new ones this year alone. Thai Kim Sim of Supermax. was the latest to join the club, with a net worth estimated at about $1 billion at the stock high earlier this month.
A jump in demand due to the coronavirus outbreak has ballooned shares of companies making protective gear, suddenly turning the Southeast Asian nation into a hotspot for creating ultra-wealthy individuals within the sector. Top Glove, the world’s biggest maker of the product, Hartalega Holdings and Kossan Rubber Industries have all benefited. But with a fivefold jump, Supermax’s ascent has been particularly notable this year.
“It has become a new norm to wear gloves for various purposes, including medical and retail, and the high usage will benefit their makers in the long term,” said Walter Aw, an analyst at CGS-CIMB Research. “Supermax is a very interesting story. It does its own brand manufacturing, while others are mainly suppliers.”
Just like social distancing and temperature checks, wearing protective equipment has become the norm with the virus pandemic that has already killed more than 430,000 people worldwide. Global demand for rubber gloves could grow another 11% to 330 billion pieces this year, two-thirds of which is likely to come from Malaysia, the country’s rubber glove manufacturers association estimates.
The Southeast Asian nation became a glove powerhouse in the 1980s when demand began to surge with the AIDS epidemic. Thanks to low labor costs, Malaysian entrepreneurs were able to quickly set up shop. The country’s plantations of rubber trees -British colonists introduced the plants originally from Brazil in the 1870s - and its large oil industry help provides local manufacturers supplies to make the protective equipment.