KUALA LUMPUR (Sept 3): The current supply glut of rubber gloves may be easing and less severe than what the industry capacity suggests, according to Hartalega Holdings Bhd (KL:HARTA), one of the world’s leading glove manufacturers.

Annual production capacity totalling 510 billion pieces announced during the pandemic overstates the actual available capacity, Kuan Mun Leong, its chief executive officer, told reporters after the group's annual general meeting on Thursday.

"There is oversupply, but is it a crisis, like great oversupply? We don't think so," Kuan said.

Many of the announced projects from new entrants never commenced or were abandoned while some older facilities have also been shut since then, he noted.

Malaysian glove makers have been grappling with an industry oversupply for nearly four years now, following a massive overexpansion of manufacturing capacity during the peak of the Covid-19 pandemic. Customers also overbought during the pandemic, leading to surplus inventories.

Rivals, especially from China, have also been ramping up productions in other Southeast Asian countries to dodge US tariffs. A deluge of Chinese-made gloves in non-American markets have also added to the pressure faced by Malaysian manufacturers.

Further, demand has surpassed pre-pandemic levels at about 330 billion pieces in 2026 compared with about 290 billion pieces in 2019, helping to ease the oversupply, according to Hartalega’s estimates.

Average selling prices of gloves, while volatile, is expected to trend higher as Hartalega passes on rising feedstock and energy costs.

Butadiene, a major feedstock for nitrile, tends to track crude oil prices closely and has also been affected by supply disruptions, with prices at about US$1,500 and reaching as high as US$2,000 in some markets this week, Kuan said.

"From now onwards, we expect butadiene prices to continue to increase," he added. Hartalega is not providing margin guidance, but is banking on improvements in automation and cost efficiency.

Net profit had jumped nearly sixfold to RM70.03 million in the quarter ended June 30, 2026 (1QFY2027), the highest in three years, outpacing a 9.5% year-on-year increase in revenue.