KUALA LUMPUR: The price of Standard Malaysian Rubber (SMR20) spiked over the RM10 per kg mark today, fuelled by a shortage of latex, which means that medical glove exports are set to be costlier.
In a telephone interview today, National Association of Smallholders Malaysia (Nash) president Datuk Aliasak Ambia said rubber prices have risen sharply in the past week.
“Rubber tapping activities continue to be disrupted by heavy rainfall and floods across Kelantan, Pahang and Johor.
“The floods in low-lying areas have not receded. Many smallholders have had to relocate to flood relief centres. Rubber tapping activities have stopped for some time,” Aliasak said.
Separately, the Malaysian Rubber Glove Manufacturers Association (Margma) said that medical glove pricing is set to rise as manufacturers are facing a shortage of natural as well as synthetic latex.
“There has been a whopping spike in prices of nitrile and natural latex in recent weeks.
“Two weeks ago, natural latex sold in bulk, was RM7.15 per kg. Today, it jumped to RM8.00 per kg in the spot market.
“So, when you compare that to the RM4.56 per kg (just) four months ago, prices have surged by more than 75 per cent,” said Margma president Denis Low Jau Foo, adding that the Meteorological Department has forecast the ongoing bad weather to lasts until March.
Synthetic latex, the main feedstock to make nitrile medical gloves, has spiked by more than 55 per cent to US$1,490 per tonne from US$946 per tonne in Sept 2016.
"We are advising our members to revise all their prices for delivery in Feb and March to be in tandem with current latex costs. Our members’ profit margins are squeezed by mounting costs," Low said when contacted by the New Straits Times today.
He highlighted closure of butadiene plants in the Middle East and Singapore as factors in the global shortage which has contributed to the drastic nitrile latex price jump.
"Nitrile latex is derived from butadiene. It is very much influenced by butadiene demand from China's revival of its motor industry," Low said.
“Due to nitrile latex shortage, prices have surged by more than US$300 per tonne to US$1,490 for Feb deliveries,” he added.
Low noted in frustration that Margma members are going through a very bad patch now. “In taking care of employee interests and ensuring business sustenance, manufacturers are raising glove prices further,” Low said.