600% hike in raw material prices hinders mask production in Malaysia

KUALA LUMPUR — A 600 per cent hike in the price of raw materials is hampering the production of masks amid rising demand in the face of the coronavirus pandemic.

Manufacturers told The Malaysian Insight that they are still producing the protective gear, but will stop once they run out of raw materials.

Ideal Healthcare Sdn Bhd managing director Haminuddin Abd Hamid said given the restrictions on getting such materials from other countries, the price of melt-blown cloth, a key material, has risen by 600 per cent.

“We are still producing at the same capacity, but there are restrictions on acquiring raw materials, and the cost of the Melt-blown Filter BFE % White has gone up by 600 per cent.

“Besides, the government imposes import duty and sales tax on the filter, but gives an exemption for the finished product.”

He said the company’s plant in Sg Petani, Kedah, will stop production when the raw materials it has are used up.

Malaysia is facing a severe shortage of masks. Pharmacies nationwide have run out of the item and are awaiting shipment from overseas.

Prime Minister Muhyiddin Yassin on Tuesday said the government has banned the export of masks to ensure sufficient supply for Malaysians during the Covid-19 crisis.

He said Putrajaya will also import masks from China as local production has been hindered by the inadequate supply of raw materials. 

“I am told that the masks will be imported at RM1.18 (S$0.40) per piece, and we will distribute these for free to the people who need them."

On Saturday (March 21), Works Minister Fadillah Yusof said 10 million masks will be brought in from China in stages as part of an agreement between the countries.

Mr Haminuddin, whose company is a major supplier of masks for the domestic market, said he has written to the International Trade and Industry Ministry on the lack of raw materials, but is not getting a reasonable answer.

“Maybe some importers can take over importing the goods from China, and without tax, they may make some money at the current ceiling price.”

His firm imports melt-blown cloth from markets outside China, so it was not affected by the decline in Chinese production capacity in the past.

With the curfews and restrictions imposed by European countries and the US, production capacity in other regions may be affected.

China News Service reported that demand for melt-blown cloth in China has surged, making the material difficult to acquire. 

“The quotation for melt-blown cloth is around 200,000 yuan (S$40,543) per tonne. The raw material price has increased tenfold.

“On one hand, it is due to a shortage of raw materials. On the other hand, it takes a long time to produce a melt-blown machine, where the production cycle takes longer, usually between three and six months.” THE MALAYSIAN INSIGHT