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CAN MALAYSIA’S GLOVE MAKERS REPLACE MANUAL LABOUR WITH AUTOMATION? (PART 1)

CAN MALAYSIA’S GLOVE MAKERS REPLACE MANUAL LABOUR WITH AUTOMATION? (PART 1)
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By Charles F Moreira, Editor

Two Malaysian medical rubber glove makers have had imports of their gloves into the United States either denied or seized at US Customs and Border Protection (CBP) officials at US ports within the past two years based upon allegations they their gloves were produced using forced labour.

On top of that, especially migrant workers at Malaysia’s and the world’s largest glove maker were found to be infected with COVID-19, resulting in temporary shutdown of many of its factories.

Since these problems are mostly related to their migrant workers, this article sets out to explore whether Malaysia’s glove makers can save themselves such hassle by fully automating their production operations from end-to-end and dispense with manual labour.

On 26 February 2021, we reached out with questions about the industry’s adoption of advanced automation to the Malaysian Rubber Gloves Manufacturers Association (MARGMA), AFA Technologies and Doeka Asia, Doeka Industrial Automation’s Asia regional office in Puchong, and followed up with a gentle reminder about a month later, and this time also posed our questions to Top Glove by e-mail and to Hartalega by fax but only Top Glove replied, declining to answer any of our questions this time but perhaps the next time. So we were left with little choice but to go it alone and dug up quite a lot.

First some background

On 30 September 2019, the CBP issued Withhold Release Orders (WROs) against imports of five different products from different countries, claiming that they were produced or mined using forced labour.

One of these was imports of rubber gloves produced by WRP Asia Pacific (WRP), which the CBP accused of producing them using forced labour. The CBP revoked its WRO against WRP almost six months later on 23 March 2020, after it had determined that WRP no longer produced gloves using forced labour.

Then on 15 July 2020, the CBP issued an WRO against imports of medical gloves produced by Top Glove Corporation subsidiaries Top Glove Sdn Bhd and TG Medical Sdn Bhd, also based upon allegations of forced labour.

In a press release dated 6 November 2020, Top Glove stated that it had undertaken to remediate its migrant workers for recruitment fees they had paid to to agents or other parties to a revised sum of approximately RM136 million over a period of 10 months from October 2020 and that the company had made their first two remediation payments in August and September that year, and that the company had submitted the necessary information to the CBP and was following up with the US agency in the view of having the CBP revoke the WRO.

However, in its press release on 29 March 2021, the CBP stated that it had instructed its personnel to seize gloves made by Top Glove at all US ports, also on the same grounds that they were made using forced labour.

“The finding (the CBP’s finding) expands upon a Withhold Release Order (WRO) that CBP issued in July 2020. That WRO was based on reasonable but not conclusive information that multiple forced labour indicators exist in Top Glove’s production process, including debt bondage, excessive overtime, abusive working and living conditions, and retention of identity documents”, the CBP stated.

https://www.cbp.gov/newsroom/national-media-release/cbp-issues-forced-labor-finding-top-glove-corporation-bhd

COVID-19

If the CBP hasn’t been enough trouble, in a press release on 17 November 2020, Top Glove clarified that the 14 days Enhanced Movement Control Order (EMCO) order from 17th to 30th November 2020 affected about  5,700  of its workers  in  Meru,  Klang, or about 27% of its 21,000 employees.

The Star of 23 November 2020 reported that since 18 November 2020, Top Glove had temporarily shut down 16 of its 28 factories in Meru, Klang to allow for COVID-19 screening tests of the 5,700 workers in its hostels according to Ministry of Health guidelines, whilst the remaining 12 plants would operate at reduced capacity.

On 23 November, Senior Minister (Security Cluster) and Minister of of Defense, YB Dato’ Sri Ismail Sabri Bin Yaakob had said the special cabinet meeting had decided that 28 of Top Glove factories in Klang would ordered to halt operations in stages to allow the health ministry to conduct tests and quarantine.

On 14 December 2020, Bloomberg of reported that the Defense Minister had said that the 28-day lockdown on Top Glove’s worker dormitories would end following a decline in the number of positive COVID-19 cases. Fourteen of its 28 factories which were ordered to close would be allowed to resume operations, whilst the rest would re-open in stages. Altogether, 4,305 out of 5,805 tested had been found positive for COVID-19, so at least this setback for Top Glove was over.

Whilst Top Glove has been mostly on the media’s radar, however there were media reports of cases of COVID-19 being detected amongst other listed glove manufacturers, though these reports have been rather low key.

However, Top Glove and its listed competitors have reported record revenues and nett profits in their latest quarters respectively, so the medical gloves industry is still very vibrant and the setbacks faced by Top Glove have at most been a slight dent.

Malaysia’s medical gloves industry

Malaysia’s medical rubber glove manufacturers altogether supply around 75% of gloves in the world, the Associated Press estimates.

These single-use gloves are worn by surgeons whilst performing operations, by doctors, nurses, dentists, sometimes by food handlers and with the COVID-19 pandemic, also by cashiers and even by individuals for their personal protection and for the protection of others against infection.

With the surge in demand for personal protection equipment against COVID-19, Malaysia’s medical glove makers altogether produced 280 billion pieces of gloves in 2020 and realised leaps in quarterly revenues by around three and five times before the pandemic and leaps in quarterly nett profits by as much as between 10 and 35 times, and about 99.95% of gloves made in Malaysia are exported.

For example, amongst the “big four” glove makers listed on Bursa Malaysia (Malaysian Bourse), Top Glove Malaysia’s and the world’s largest glove manufacturer reported second quarter 2021 revenue of over RM5.36 billion and nett profit of over RM2.86 billion, Hartalega reported Q3 2020 revenue of close to RM2.13 billion and nett profit of just over RM1 billion, Kossan reported Q4 2020 revenue of just over RM1.3 billion and nett profit close to RM542.5 million and Supermax reported Q2 2020 revenue of close to RM2 billion and nett profit close to RM1.06 billion.

Amongst the smaller listed glove makers, Careplus reported Q4 2020 revenue of just over RM129.3 million and nett profit close to RM42.3 million, Comfort reported Q4 2021 revenue of RM319.8 million and nett profit just above RM137.8 million, whilst Rubberex reported Q4 2020 revenue just above RM152.8 million and nett profit just above RM59.4 million.

All the seven listed glove companies have different financial year ends and the above are their latest respective quarterly figures at time of writing.

Besides the above glove makers are many more large and small unlisted (on Bursa Malaysia) glove manufactures, such as WRP Asia Pacific, Riverstone Holdings, SSN Medical Products, Qube Medical Products, Raybell Engineering, the Singapore-based UG Healthcare Corporation with two factories in Seremban, Malaysia and many others with factories mostly across Peninsular Malaysia.

All glove makers in Malaysia, including own brand labellers (who buy gloves form the factories in bulk and pack them under their own brand name) as well as companies who have their gloves packed under their own brand name by OEM (original equipment manufacturers) must be licensed and have their glove brand certified by the Ministry of Health’s Medical Device Authority. They are also required to have their premises and practices certified to ISO 13485 quality management standard by independent ISO auditors.

Advanced automation?

What’s apparent in the cases or WRP and Top Glove, as well as other glove manufacturers, is their reliance on large numbers of workers, mostly migrant, which brings to mind the first article in our three part series on Industry 4.0 generation industrial automation – Malaysia’s Industry 4.0 Journey – What And Why, on 25 September 2019, in which a speaker at that Industry 4.0 conference, Raja Segaran, Head of Strategy & Research, Corporate Strategy, Malaysian Digital Economy Corporation (MDEC) said:-

“We worked with Top Glove on how to reduce their rejection rate on a production line and they managed to totally eliminate unplanned downtime and reduced quality-assurance (QA) rejection on this line by 57% through the use of technology.”

A key message at that conferences, as well as in Malaysia’s Industry 4.0 initiative dubbed Industry4WRD is that the adoption of Industry 4.0 generation advanced automation will enable manufacturers to reduce their reliance on manual labour, especially migrant labour.

It is obvious from the process flowchart below, that the part of the production process where MDEC worked with Top Glove on to reduce QA rejects is somewhere between the loading of the ceramic formers and the stripping or the gloves off the formers before samples are sent to QA for AQL (pinholes), various residues and other tests as per Figure 2: Online dipping process for natural rubber glove, under Methods of Manufacturing of NR Gloves by Dipping on the Malaysian Rubber Council’s website:-

Making medical gloves

I have visited two medical glove factories and have viewed many corporate videos showing their glove production lines and processes on You Tube, as well as private videos of visits to glove factories, as well as videos taken by workers in the plant.

From all the above, it is clearly apparent that the actual glove production line is already highly automated and capital intensive with huge continuous chains of ceramic formers shaped like a human forearm automatically dipping into cleaning tanks, being dried, dipping into the coagulant tank, being dried, then dipping into a tank of liquid latex or nitrile (a synthetic rubber), passing through a furnace which solidifies the latex or nitrile until the end of line where a blast of air blows latex gloves off the formers into a hopper, whilst in the case of nitrile gloves which are stickier, human workers pull them off the formers, which then return to the beginning of line and go through the whole process again.

All the formers on a line are of the same size corresponding to the size of the gloves being made – i.e. extra small, small, medium, large and extra large.
With the exception of the final stripping stage, in these videos I saw hardly any manual workers at most stages of the production process, which is highly automated, even if not to Industry 3.0 or 4.0 generation.

However on its website, amongst it’s innovations in production, Hartalega says that it is the first to develop an automated glove stripping machine.

After batches of these gloves have come off the production line samples are taken and tested for freedom from pinholes and visual defects, dimensions, thickness, tensile strength, elongation and powder residue and latex proteins level, and the QA operations are mostly performed manually, though more recently some of the operations have been automated.

For instance, medical gloves are very thin, with thickness of around 0.05mm to 0.08mm, so as to enable caregivers to be maintain their feel whilst inspecting the patient, and with such thinness, pinholes are easily formed when the liquid latex or nitrile does not form a continuous layer over the ceramic formers, such as due to the formers not being thoroughly cleaned to remove any residues or specks of dust or dirt left over after the production run, or due to tiny air bubbles in the liquid latex or nitrile tank sticking to the ceramic former and these can result in small leaks in the glove.

The primary purpose of medical grade gloves is to serve as effective barrier between the nurse, doctor or dentist and the patient, to prevent the transfer of any bacteria, viruses and fungi between the two parties, especially when it involves coming into contact with body fluids such as blood, saliva, urine, faeces and so forth, and any leakage in the glove can result in it failing to adequately perform its function.

Tests for pinholes are either conducted by an operator blowing them up with compressed air like a balloon and then submerging them in water to see if they leak. Another way is to fill them with water to see if they leak.

Several companies, including Malaysian company AFA Technologies and Indian company PEEPL Automation  have developed automatic compressed air pinhole testing machines which inflate the gloves with clean, dry compressed air with high-precision pressure sensors which detect loss of pressure and the machine then drops the good and bad gloves into respective bins. However, they still require manual workers to load the gloves onto the test machine and for visual inspection.

It is recognised industry-wide, that pinhole and other defects in gloves cannot be totally eliminated, so based upon industry standard statistical tables and guidelines, the QA tests on the samples seek to determine from the sample, the acceptable quality level (AQL) number of the gloves in the batch and medical examination gloves usually have to meet AQL 1.5 or not more than 1.5% of gloves in a batch or not more than 15 gloves per 1,000 pieces have defects such as pinholes.

Examination gloves like those used by clinical doctors, nurses, dentists and food handlers come in boxes, which can be bought in pharmacies, are clean but not sterilised. On the other hand, surgeons must wear sterile surgical grade gloves when performing operations and these gloves must go through additional sterilisation processes and must be handled and packed under cleanroom conditions. Surgical gloves are usually tested for tighter AQL numbers such as AQL 0.65.

Part 2 of the article can be read HERE

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