The Disposable Glove Industry Is In The Ascendant, And Domestic Manufacturers Are Expected To Overtake In Corners

- Oct 07, 2020-

Since 2020, the epidemic caused by the new crown virus has continued to spread at home and abroad. As of June 18, the cumulative number of infections worldwide has exceeded 8.4 million, and the death toll has exceeded 440,000. There is no obvious turning point. As a result, the medical community currently generally believes that the epidemic cannot be effectively controlled within this year, and the world will face a long-term coexistence with the epidemic.

   Under the background that the epidemic is difficult to control in the short term, how to effectively isolate the virus has become the focus of residents' daily protection. The "New Coronavirus Infection Pneumonia Diagnosis and Treatment Plan" pointed out that the virus is mainly spread through respiratory droplets and contact transmission, so wearing masks and gloves has become an effective measure to block the spread of the new coronavirus.

Reflecting on the A-share market, the share price of Intech Medical (300677), whose main business is disposable gloves, has risen by more than 500% this year, ranking first in the Shanghai and Shenzhen stock markets, which has also greatly increased the capital market’s attention to the disposable glove industry. .

  The demand for disposable gloves continues to be strong

According to the data, disposable gloves can be divided into latex gloves, nitrile gloves and PVC gloves according to their materials. Among them, latex has the disadvantages of causing skin allergies and higher prices for some people, while nitrile gloves can prevent skin allergies well and have The advantages of high elasticity and high fit bring greater comfort to users. With the continuous improvement of the manufacturing process of nitrile gloves, it has begun to replace latex gloves in the high-end medical field, and its market share has continued to rise.

   In recent years, the global disposable protective gloves market has grown steadily. In 2017, the global sales volume reached 417 billion, and the compound annual growth rate from 2005 to 2017 was about 8%. According to the China Plastics Association and the Malaysian Glove Industry Association, the global market capacity of medical-grade gloves in 2017 was approximately 270 billion. Among them, the demand for PVC gloves is about 75 billion, with an average compound growth rate of 3% from 2009 to 2017; the demand for nitrile and latex gloves is about 200 billion, with an average annual compound growth rate of about 8%-10%.

   With the spread of the epidemic around the world, the demand for various medical protective products such as nitrile gloves and PVC gloves has soared in various countries around the world, and disposable gloves are in short supply globally. At the same time, as countries such as Europe and the United States gradually resume work and production, residents' demand for disposable gloves will further increase. In addition, after the normalization of the epidemic, global public health and health protection awareness has been structurally improved, and countries will gradually begin to improve their emergency response capacity systems, which will also drive long-term demand for health protection products.

  From historical experience, every major public health event is a catalyst to increase the demand for the disposable glove industry. US residents developed the habit of using disposable gloves during the AIDS outbreak in the 1990s. SARS in 2003 and H1N1 flu in 2009 also greatly increased the global demand for disposable gloves.

   Not only that, the demand for gloves did not fall after the epidemic ended. The reason was that the epidemic increased the overall protection awareness of residents. At the same time, governments in various countries will also regulate the use of disposable gloves after the epidemic. Medical professionals pointed out that the impact of the new crown epidemic on the world far exceeds SARS, and it is expected that the demand for disposable protective gloves is expected to maintain high growth for a long time in the future.

   Market share is accelerating to the leading position

   In the case of continued strong demand, the global disposable glove production capacity cannot be increased significantly in the short term, mainly because the technical difficulty and capital investment in the construction of the glove production line are very huge.

   It is understood that, different from protective products such as masks, disposable gloves processing equipment is non-standard, and each manufacturer needs to develop, design and construct by itself. Taking Intech Medical as an example, the length of the main chain of its nitrile glove production line is close to 1.5 kilometers, and there are about 3000 control points. It is extremely difficult to make the production line run efficiently, stably and with low energy consumption and ensure product quality. There is no experience in the production of disposable gloves. It is difficult for other manufacturers to enter.

   At the same time, a nitrile two-hand mold production line invested about 20 million yuan. Taking into account the size and color of the gloves, the industry generally starts with ten production lines. Based on this calculation, the investment threshold for the nitrile glove factory will exceed 200 million yuan. In addition, the construction period of the nitrile glove production line is relatively long. It takes at least 14-18 months for a project plan to realize the first production line and put it into operation. When the epidemic trend is unknown, only leading manufacturers with technical and financial advantages dare Build a large-scale butyronitrile production line.

Considering that the production lines of many small and medium manufacturers in the industry were built before 2012, with the gradual commissioning of new production lines of leading manufacturers, the elimination of small and medium manufacturers with low automation, low production efficiency and high energy consumption will be accelerated, and the market share of the disposable glove industry Will accelerate to focus on the leader.