source: [thestar online]
MARGMA: Glove prices expected to rise from electricity tariff review
KUALA LUMPUR: The electricity tariff review will increase production costs significantly for rubber glove manufacturers, said the Malaysian Rubber Glove Manufacturers Association (MARGMA).
President Lim Kwee Shyan said electricity cost forms part of the energy cost which currently accounts for 10 per cent of the rubber glove manufacturers' total production costs.
He said the production cost for 1,000 gloves will increase between US$0.20 and US$0.60 (RM0.63-RM1.90), depending on the type of equipment used.
Other costs would also increase due to the higher electricity cost throughout the entire supply chain. "Glove buyers and manufacturers are advised to compute this in their price review," he added.
On Monday, Energy, Green Technology and Water Minister Datuk Seri Dr Maximus Ongkili announced a review of electricity and gas subsidies, with the average electricity tariff in Peninsular Malaysia to be raised 4.99 sen per kilowatt-hour (kWh) in Peninsular Malaysia and 5.0 sen/kWh in Sabah.
Both rates would come into force Jan 1, 2014.
MARGMA recognises that electricity tariff should be at market rate but feels that the market price must be gradual and pre-announced to give sufficient time for adjustments.
"The increase definitely has to come but the government should give us more time to adjust to the new cost structure and to liaise accordingly with our customers," Lim said. - Bernama
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