However, the shining star among the glove counters was Supermax Corp Bhd, founded by its executive chairman Stanley Thai, which surged as much as 11.6%.
Top Glove Corp Bhd, the world’s largest natural rubber glove producer, and Hartalega Holdings Bhd both rose as much as 5% while Kossan Rubber Industries Bhd jumped 8.1%.
The glove makers all pared their gains by close of trading with Supermax up 4% or 3 sen to 80.5 sen, valuing it at RM2.63 billion.
Supermax was the third most actively traded stock for the day with 81 million shares changing hands while Top Glove was the sixth most active counter with 47.3 million shares traded.
The local bourse was immersed in red yesterday with 919 losers and 224 winners as the benchmark FBM KLCI hit a 20-month low, down 2.98% to 1,400.59 points.
The selldown was in the wake of US President Donald Trump’s punishing reciprocal tariffs on dozens of countries including Malaysia taking effect yesterday.
This included the eye watering 125% duty on Chinese goods, after the US responded to counter-tariffs from Beijing, escalating a global trade war.
However, Supermax, the smallest among the top four Malaysian glove makers by market capitalisation, has a huge advantage over its peers. It is the only one with a glove manufacturing facility in the US.
This means that gloves made by its wholly owned US subsidiary Maxter Healthcare Inc will not be slapped with any tariff, unlike other Malaysian glove makers which will be hit with a 24% import duty.
More crucially, Supermax’s main competitors – China-based glove makers – will likely be crushed by the 125% duty imposed by the Trump administration.
In a tit-for-tat move yesterday, China hit back again on Trump’s tariff policies by hiking its levies by 50% on all US imports. Tariffs on US goods entering China will rise to 84% from 34% starting today.
This came after Trump raised its tariffs on Chinese products to a staggering 104%.
Today, however, Trump announced on his Truth Social network that he was halting levies for almost all nations for 90 days but doubled down by raising tarrifs on China to 125% due to a “lack of respect”.
Thai’s master stroke
In what now seems to be a master stroke by Thai, Supermax announced in 2021 it would set up its first manufacturing facility in the US, in Houston, Texas.
However, it would be fair to say that Thai could not have envisaged the US and China engaged in a full-blown trade war in 2025.
To be built over four phases, the Maxter plant will have an annual production capacity of 19.2 billion pieces of gloves when fully completed.
Phase one, which entails capital expenditure of US$350 million (RM1.57 billion), will have a total production capacity of 4.8 billion pieces of nitrile gloves per annum. The plant commenced production in January this year.
Nevertheless, it’s not all hunky dory for Supermax despite their potential good fortune in the US. Year to date, its shares have fallen 35%, and last February it reported its ninth consecutive quarterly loss for the second quarter ended Dec 31, 2024 (Q2 FY2025).
The Q2 net loss narrowed to RM4.92 million from RM44.36 million a year ago. The improvement was partly driven by a RM29.5 million forex gain from the stronger US dollar against the ringgit, as well as efficiency gains from automation and cost rationalisation measures, it said in a bourse filing.
It also noted then that in view of the upcoming US tariffs, Chinese glove makers had deployed “aggressive pricing in non-US markets” such as Europe and South America for rapid market penetration.
In the long run, Supermax said US tariffs on China-made gloves will benefit Malaysian glove makers by driving higher utilisation rates and average selling prices (ASPs) for Malaysian-made gloves.
Thai, 65, started Supermax with his wife Cheryl Tan, 64, in 1987 as a distributor of latex gloves, and began manufacturing gloves in 1989.
Today, the group manufactures 24 billion gloves a year and exports to 165 countries, according to Forbes.