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Malaysian rubber glove manufacturer WRP Asia Pacific Sdn Bhd is shutting down its business operations this month
The company has become one of the first Malaysian glove makers to collapse under the weight of supply chain disruptions caused by the ongoing Middle East conflict.
In a letter to customers dated 31 March, WRP Asia Pacific cited "severe disruptions across global energy and petrochemical supply chains" caused by the war in Iran being waged by the US and Israel as the reason behind its closure.
The company said it had faced "significant" increases in petrochemical-derived raw material costs, unpredictable procurement timelines, and suppliers demanding advance payments it could no longer accommodate, reported Bloomberg.
"These unforeseen circumstances have forced us to make the difficult but necessary decision to begin the process of winding down business operations with effect from 15 April," the letter read.
So why is a war in the Middle East affecting glove makers in Malaysia?
The connection between a war thousands of kilometres away and a glove factory in Malaysia comes down to one ingredient: nitrile latex.
Nitrile latex is the synthetic rubber used to make the disposable gloves found in hospitals, clinics, food processing plants, and beauty salons. Its price is directly tied to global energy markets, meaning when oil supply is disrupted, so is the cost of making gloves.
The blockade of the Strait of Hormuz has made things significantly worse.
According to Bloomberg, the Malaysian Rubber Glove Manufacturers Association (MARGMA) warned just days before WRP's announcement that the blockade had caused a shortage of key raw materials, placing "immense financial strain on local manufacturers" and threatening the global supply of medical gloves.
One chemical in particular, butadiene, a core ingredient in disposable gloves, has surged nearly 70% in price since the war began.
Since butadiene can account for more than half of nitrile latex costs, even a moderate price spike is enough to severely squeeze manufacturers' margins, as reported by The Edge.
Is WRP Asia Pacific the only Malaysian glove maker affected?
No, the entire Malaysian rubber glove industry is under pressure.
Top Glove Corporation Bhd, the world's largest rubber glove manufacturer, has already raised its prices after raw material costs climbed more than 50%. The company is also encouraging customers to switch to natural rubber gloves while it works to secure supply for the coming months.
Former MARGMA CEO Chan Wone Fu warned that glove companies without sufficient nitrile butadiene rubber latex in stock would be forced to reschedule production.
For WRP Asia Pacific, that pressure proved too much to sustain.
What happens to WRP Asia Pacific now?
General manager of operations Nadarajah Swaminathan confirmed the wind-down with Bloomberg but said the company is still awaiting feedback from shareholders. He noted that potential buyers could still emerge, leaving the door open for an acquisition.
Whether the recently announced two-week ceasefire and Tehran's agreement to reopen the Strait of Hormuz will bring any meaningful relief to the broader industry remains uncertain.
WRP makes surgical, examination, and speciality gloves for the healthcare, food processing, and beauty industries
Like many Malaysian glove makers, it saw explosive demand during the COVID-19 pandemic, but the years that followed were difficult.
The company posted a RM78 million loss on RM204.6 million in revenue for the financial year ending June 2024, according to regulatory filings.
Its closure is a significant moment for Malaysia, which produces roughly 45% of the world's rubber gloves and exports to 195 countries.
The industry's ability to weather this crisis will have real implications for global healthcare supply chains.
