When this blog was launched a few weeks back, the goal was simple: inform our business partners of industry conditions affecting gloves that cannot be explained by exchange rates, raw material prices, and energy costs alone. Never have these issues, which lie outside of the simple black-and-white pricing charts, been more evident than in the past few weeks.
A quick look at our pricing trends page, and one would believe there to be ample reason for optimism. Oil has dropped by 15% in the past month and latex has retreated from its record highs set a few weeks back. Even the US Dollar, which has struggled for more than two years, has made strides against several foreign currencies in the last 30 days.
Consider, however, current cost pressures these pricing trends fail to portray:
- Rippling PVC prices
- Olympics shutdowns
- Blackouts
- Labor shortages
- Cash flow problems
- Increases in Malaysian natural gas costs
- Freight surcharges
- New FDA glove standards
- Tightened lending limits
- Reduced capacity
- Speculative buying
In sum, while we remain hopeful that favorable pricing trends will continue, market intelligence suggests that conditions will continue to worsen in the coming months.
