Malaysia's Top Glove Corporation Bhd, which makes one in five gloves worldwide, expects a product shortage as demand from Europe and the United States exceeds its capacity due to the increasing outbreak of the coronavirus.
The company has extended delivery times to meet the surge in demand, CEO Lim Wee Chai told Reuters on Friday over the phone. According to Lim, orders received mainly from Europe and the United States in the past few weeks have been almost twice the company's production capacity.
Top Glove can produce 200 million natural and synthetic rubber gloves every day. There are now more than 600,000 coronavirus cases in 202 countries and territories worldwide, with the United States overtaking China as the country with the most infections.
Europe continues to report the largest number of deaths. "Some customers panic. Usually they order 10 containers a month, but now they suddenly increase to 20 containers," he said.
The World Health Organization warned on Friday that the "chronic global shortage of personal protective equipment" is one of the most pressing threats to efforts to contain viruses. "In any case there is a lack
You order 100% more, we can only increase 20%, so there is a deficiency of around 50% to 80%, "he said.
The extraordinary buying momentum could continue for another three months, but orders are expected to remain strong for up to nine months, even though demand from Asian markets has slowed slightly, Lim said.
To cope with this, the company has adjusted its delivery time from just 30 days to 150 days. According to Lim, the company has ensured that all customers receive a reasonable share of additional gloves.
"We manage their volume, limit them to buying as much per customer. We have to manage it, but it's a good problem for us to solve it," he said.
According to Lim, the company adds new machines every week and could increase its production by up to 30%. This month Top Glove has increased its factory utilization by 10% to 95% and expects to reach nearly maximum utilization in April.
The company hurries to find around 1,000 employees to keep up.
Top Glove normally hires from Nepal but is now moving workers from Malaysia due to travel restrictions.
"We need about 10% additional workforce. During this time (on curbs) we cannot hire a Nepalese worker either. So we have no choice, we have to use some local workers to help, especially with packaging."
Top Glove said its supply chain is well diversified and optimistic that there will be no material procurement issues in the next few weeks
Malaysia has given some manufacturers in the essential goods sectors permission to continue working under certain conditions during the country's April 14 closure.
(Except for the headline, this story was not edited by NDTV staff and published from a syndicated feed.)