PETALING JAYA: The outlook for the rubber glove industry continues to be cautious, although analysts across the board agree that it has now bottomed out as most industry players persisted to sustain the bounceback by recording profitability in their latest quarterly results.
With global macro factors such as US tariffs and the business policies of Chinese manufacturers who are constantly on the lookout for new markets posing as potential banana skins, local glove companies have been keeping on their toes to ensure they remain in the black.
As a sector analyst with a foreign research house put it: “The Malaysian rubber glove industry, which commands around 45% of the global market share as the world’s leading producer, is navigating a complex landscape in 2025.”
The analyst elaborated that while demand is showing signs of recovery post-oversupply glut from the lockdown era, the current positive momentum is tempered also by intensifying competition particularly from China in non-US markets, structural oversupply, rising costs and broader macroeconomic uncertainties.
Understandably, however, industry veteran and chairman at Top Glove Corp Bhd
Tan Sri Lim Wee Chai prefers to deal with factors that his company – still the world’s largest rubber glove manufacturer by production capacity and market share – can control, as to his mind, most of the challenges the sector is facing are external anyway.
“Foremost to our strategy is implementing quality improvement and cost efficiency initiatives across our operations on a continual basis, to ensure we are able to produce and sell gloves at competitive prices while meeting customers’ requirements,” he told StarBiz.
To this end, Lim shared that Top Glove has continued upgrading its production facilities through the adaptation of new technologies which enable manpower reduction, thereby improving quality, efficiency and speed, while reducing human error and wastage.
Expanding on the use of technology, he said automation has been an integral part of the group’s strategy since January 2013 when the minimum wage policy first came into effect.
Contextually, the minimum wage policy was set at RM900 monthly for Peninsular Malaysia and RM800 per month for Sabah, Sarawak and Labuan more than 12 years ago, which of course has since undergone a number of revisions, settling at RM1,700 this year.
“Our ongoing efforts have seen a substantial reduction in the number of workers per million pieces of gloves from eight persons in 2013 to 1.6 persons in 2025.
“We will continue to advance automation across our operations to deliver greater efficiency, agility, long-term competitiveness and sustainable growth,” Lim observed.
On top of automation, he said Top Glove is also utilising enterprise software such as SAP to manage processes from order taking and procurement to manufacturing, warehousing and reporting, ensuring real time accuracy that supports effective decision making.
At the same time, he pointed out that it is also essential for the group to maintain a balanced product mix of natural and synthetic gloves, ensuring it is well placed to accommodate the different requirements both in developed and developing nations.
In addition, he said Top Glove is also strategically leveraging the current US tariff situation to capture a bigger market share Stateside, which has since increased from less than 20% in the last financial year to above 30% at present.
“Meanwhile, towards mitigating the uncertain geopolitical situation, we are continuing to proactively diversify risks across Malaysia, Thailand and Vietnam where we have manufacturing facilities, ensuring that we are well positioned to respond to developments, whether related to our country or our customers’ countries,” Lim, who founded Top Glove in 1991, told StarBiz.
In tandem, he added that the group is also working closely with government agencies and ministries to facilitate business growth, which he opined to be similar to the support the Chinese government extends to its enterprises in their global expansion.
The “cautiously optimistic” tone, cliched as it may be, underlines Top Glove’s strategy for moving ahead and is also mirrored by other major industry players, such as Kossan Rubber Industries Bhd and Hartalega Holdings Bhd, who are anticipating an improving global market supported by steady restocking activities and a gradual structural recovery in demand.
Perhaps viewing the glass as half full, Hartalega chairman Kuan Kam Hon had remarked that US tariffs are actually providing support to Malaysian businesses and reshaping the glove market’s dynamics.
Earlier this month, he had explained that the lower tariffs on Malaysian goods, compared with higher duties imposed on China, are giving local businesses a competitive edge particularly for glove producers.
For 2025, Kuan mentioned that glove consumption is projected to hover at lockdown levels, which indicates that market demand has rebounded, before adding that global glove demand is projected to reach about 370 billion pieces in 2026 – a level comparable to consumption during the lockdowns.
Reflecting the industry-wide stance of investing heavily into automation, the group’s chief executive Kuan Mun Leong had noted that improvement in production underpins Hartalega’s continued focus on operational efficiency, prudent cost management and disciplined execution of its long-term strategy.
On the flip side, the industry analyst with the foreign brokerage is adopting a slightly more guarded view, believing that sector recovery will be gradual and uneven, clouded by tariff risks, cost inflation, and structural competition from China and Thailand.
He said the industry is unlikely to revisit lockdown-era peaks, but over the medium term, global demand growth should sustain a recovery – favouring well-capitalised and technologically advanced producers.
“Demand recovery and US market share gains offer upside potential, positioning Malaysia to benefit from trade diversions away from China.
“However, the sector’s rebound is stalling in the second half of 2025 due to tariff-induced uncertainties, competitive pressures, and oversupply, leading to a challenging near-term environment with limited earnings growth,” said the analyst.
Nevertheless, he added that strategic initiatives, such as the Malaysia Sustainable Natural Rubber programme and tech upgrades under the 13th Malaysia Plan, could bolster long-term resilience, although investors should continue to monitor US policy developments and quarterly earnings from majors like Top Glove and Hartalega for signs of sustained improvement.
“If tariff effects stabilise favourably and demand accelerates, the industry could see stronger momentum into 2026; otherwise, headwinds may prolong the recovery phase,” he said.
