AS COVID-19 ravaged the glove market, glove makers across the world made a “windfall”, creating instant millionaires and billionaires among them.
“As states scrambled to source for masks and gowns as borders quickly shut, igniting a bidding war for personal protective equipment (PPE).
“Eventually, domestic production kicked in to save the day, churning out everything from respirators to face shields. But one item in particular is still in critical shortage as the pandemic lurches into its second year: medical glove,” Forbes was reported saying.
Initially prices at US$3 per box (100 nitrile gloves) pre-pandemic, COVID-19 has skyrocketed the price tag to US$32, according to Singapore-based Persistence Market Research.
“The frenzy has minted at least four new medical glove billionaires and centimillionaires: Stanley Thai (US$1.5 bil Malaysia), Lim Kuang Sia (US$1.2 bil, Malaysia), Somwang Sincharoenkul (US$730 mil, Thailand) and Wieslaw Zyznowski (US$670 mil, Poland).
Lim, the founder of Kossan Rubber, however shares his fortune with his four brothers.
“At this point there isn’t even a pretense of passing this on because costs are going up,” says Bruce Levitt, the CEO of Levitt-Safety, a Canadian safety equipment supplier that distributes gloves in North America.
“It’s just a matter that the gloves’ manufacturers have said, ‘This is our opportunity to make boatloads of money.’”
On that note, Malaysian glove makers benefitted the most from COVID-19 as supply almost 60% of the gloves in North America.
For instance, Top Glove Corporation Bhd, helmed by Lim Wee Chai, saw the company’s revenue rising to US$1.8 bil last year, up by a whopping 51% a year earlier. With that, Lim’s net worth tripled to US$4.1 bil.
When queried on profiteering during crisis, one of the local glove players, Riverstone Holdings co-founder Wong Teek Son blamed higher prices of raw material for the spike in glove prices.
“The price of nitrile rubber has increased by 250%, from about US$850 a tonne in March to anywhere from US$2,000 to US$4,500 a tonne in December, depending on the supplier,” he was reported saying.
However, the soaring prices also created opportunities for scammers and unscrupulous vendors to take advantage of the situation.
“There’s a scam out there where people will say, ‘I have a million boxes of gloves at a fairly attractive price.’ And then you start going down the road with them, and all of a sudden, they either go dark, or they’ll say, ‘Oh, you’ve got to pay this company in Cambodia,’ or wherever,” said Levitt.
“People have figured out that they can use nitrile gloves to launder money,” he added. – Feb 13, 2021
