Malaysia Covid-19 Shutdown Impacts

Malaysia Covid-19 Shutdown Impacts

Malaysia Covid-19 Shutdown Impacts

In the United States, the immunisation campaign has been successful, with lower incidence of illnesses and fatalities. However, the majority of the planet is still in the grip of the pandemic, and the ongoing outbreak in Southeast Asia and India are still a major concern.

Malaysia Shutdown

Malaysia has been hit very hard with new variants that are much more contagious than what they have previously dealt with, which has caused them to reach their all time high in Covid cases.
After a spike in overall infections pushed Malaysia into a severe lockdown, health officials in Malaysia and Thailand have expressed worry over an increasing number of coronavirus deaths. The supply of gloves will be immediately impacted since the lockdown is now extended and these two countries manufacture roughly 80% of the medical gloves globally.

Despite improvements in output by certain glovemakers and assurances from a national trade association that there will be no shortages in PPE manufacturing, Malaysia’s newest movement control order has reduced workforces to roughly 60% of its normal capacity. “Unfortunately, this will have a substantial impact on both the domestic and international healthcare value chains in terms of supply interruption.” In a written response to The Edge, Hartalega claimed. Factory employees from numerous locations have been infected with the coronavirus at alarming rates, which has hindered production and caused firms to implement internal quarantines.

Selangor EMCO

EMCO is a is a series of national quarantine and cordon sanitaire measures implemented by the federal government of Malaysia in response to the COVID-19 pandemic. It is referred to internationally as a “lockdown”, and holds restrictions on movement, assembly, international travel, and mandates the closure of businesses, industries, government and educational institutions.

Due to the Enhanced Movement Control Order (EMCO) in many areas in Selangor, glove makers have halted operations in the city of Klang. In accordance with EMCO guidelines, Top Glove Corp Bhd, the world’s largest glove maker, has temporarily halted operations at its medical glove facilities in Klang, which holds more than half of its factories. Hartalega Holdings Bhd also announced that all of its production facilities in the cities of Bestari Jaya and Sepang have been shut down completely.

According to Chairman Mathieu Roturier of French medical glove distributor Euromedis SA, “This abrupt shutdown sends a terrible signal that Malaysia is unable to meet its global supply as a top medical glove maker.” As Malaysia supplies 67% of total gloves consumed globally, global customers of the manufacturers are contacting them with considerable worry about a lack of production and delivery of gloves since the government announced the enforced EMCO on the state of Selangor.

Since the restrictions, the Malaysian Rubber Glove Manufacturers Association (MARGMA) has requested that the government enables Selangor glove companies to operate under the EMCO. “Global hospitals and healthcare professionals are putting great strain on our members since the pandemic has now morphed into another form,” MARGMA president Dr Supramaniam Shanmugam said in a statement.

As the outbreak rages on, the tightened restrictions are imposed until July 16th, but it is still unsure as to when the situation will be under control and when these manufacturers will be fully opened again.
These interruptions will continue to put pressure on the disposable glove supply, and worldwide demand will likely maintain prices high for the rest of 2021 and well into 2022, relative to pre-COVID levels.

EMCO Impact on the coming months

Malaysia’s EMCO has shutdown 1 China’s worth of glove production. In the United States, this translates to a monthly deficit of 30-35 million boxes of medical gloves, with a cumulative shortfall of up to 100 million boxes from June to September. This will be evident with the arrivals from August to November, with a substantial influence in September as it takes 6-8 weeks from Malaysia production to US arrival.

Efforts to have glove factories exempted or reopened sooner have so far been unsuccessful, due to the fact that Covid cases are at an all-time high. What should hospitals in the United States do? Supplies will arrive in the United States by November, assuming facilities are fully operational by September. As a result, maintaining adequate supplies until December would be advisable. Check back in if you have manufacturing gloves due to ship in July for the September distribution, since the majors (Cardinal/Medline/etc.) have been impacted and channel inventories will be pressured.

Key Takeaways and Actions to Take

  • Malaysia’s EMCO has shutdown 1 China’s worth of glove production.
  • Prices are likely to remain high for the rest of 2021 and well into 2022.
  • As Malaysian manufacturers are shutting down and price of ocean freight is rising exponentially, it is probably a good idea to look into North American on the ground nitrile gloves