Category Impact of COVID – 19: Masks

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By: Beroe Inc --

22 March, 2020

Category Impact of COVID – 19: Masks
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masks market covid 19
 

U.S. Stockpiling and Global Export Dynamics for Masks
 

  • As of March 11: According to a new report from Global Trade Alert, a trade-policy monitoring service at the University of St Gallen in Switzerland, 24 countries had restricted exports of medical equipment, medicines or their ingredients as of March 11 .
  • As of March 10: With the deadly virus now present in over 100 countries, companies are unable to match demand for the masks needed by health workers. The U.S only has about 1 percent of the 3.5 billion masks it needs to combat a serious outbreak, Health and Human Services Secretary Alex Azar has said. The country plans to buy 500 million surgical masks and N95 respirators for the national stockpile.
  • South Korea has banned the export of masks and of materials used to make respirators.
  • Countries with relatively few coronavirus cases so far, including Russia, Bulgaria  and Morocco  are  also applying restricting export of masks.
  • Germany announced export bans of masks and joins others nation or territories including India, Taiwan, Thailand, and Kazakhstan that earlier put similar bans in place.
  • In some countries, including Japan and Germany, doctors are being told to reuse the single mask they get daily because of a lack of supply.

China Mask Factories and Global Mask Manufacturers Comments:
 

  • March 10: China factories produced about half of the world’s output of masks with daily production of about 20 million units. The spread of COVID-19 has made China factories  to boost production more than five-fold and are enlisting carmakers to manufacture them. It is understood that it is still not enough for the global needs.
  • Companies such as 3M Co and DuPont De Nemours Inc are also falling short of demand and made efforts to increase the mask production. They have increased production by more than three times their usual global capacity.

Risk of Shortage on Major Products Masks and others

Masks

high

Sterile Gowns

high

Disinfectants

high

Hand Sanitizers

high

Medical Alcohol

high


Masks Suppliers and Google Comments on Masks

Supplier Comments on Mask demand and supply:
 

  • “We’ve added staff, we’ve added overtime, we’ve added technology, we’ve been increasing manufacturing lines,” said 3M spokeswoman Jennifer Ehrlich. “We expect this demand for respirators and other supplies to continue to outpace supply for the foreseeable future.”
  • South African company U-Mask, which donated 30 000 of its premium N95 face masks to the Chinese government to help curb the spread of Covid-19, now says it has back orders in the hundreds of millions.
  • Co-founder, Jordean Eksteen, told a news channel  that since its donation, the company had secured more business from other Asian companies and the Chinese government that will take years to fulfil the demand.
  • “We are busy adding more machines to increase our production from four to six million units per month," said Eksteen.
  • The U-Mask plant currently operates 24 hours a day, in shifts, to meet the growing demand.

Google and Facebook Comments:
 

  • Google and Facebook is temporarily banning ads for medical face masks.  - “Out of an abundance of caution, we have decided to temporarily ban all medical face mask ads,” a Google spokeswoman said in an email to CNBC.

China Supply Dynamics – Masks, PPE Related Products and Testing Kits


Supply Situation in China:
 

Masks: Currently, Chinese face mask manufacturers are mainly producing to meet domestic demand .  Besides general masks, the daily manufacturing capacity of N95 masks has  grown from about 200,000 to 1.6 million units. 

More than 2,500 companies in China have reportedly started making masks, among them 700 technology companies including iPhone assembler Foxconn and smartphone makers Xiaomi and Oppo, in an extraordinary mobilisation of resources.

China, the world’s biggest maker of medical masks, mentioned that it would not limit exports of the product and would abide by free trade and market principles.

Other PPE related products: The overall output of other medical equipment including disinfectant, hand sterilizers and medical alcohol in China can meet basic domestic demand. The daily output of Chinese disinfectant manufacturers is 1,579 tons, with another 1,908 tons in stock, according to media  reports. 

Also, daily output of protective suits in China has now reached 500,000 units, marking a surge from less than 20,000 at the beginning of the epidemic.

Testing kits: Mass testing has  also driven up  demand for test kits, and to help meet the global demand, some Chinese companies are consulting overseas customers about actual demands, and preparing for an increase of exports. As of now China is able to fulfill domestic demand and more than 10 enterprises are capable of producing test kits. 

Supply disruption of Meltblown cloth (Raw material for masks)
 

  • Mask manufacturers are also trapped by price inflation of supplies as the cost of raw materials  is rising daily.
  • According to an industry insider, the cost of meltblown cloth has increased by 15 times, nose bridges 10 times, earbands by 15 times, labour by 20 times, machine cost 10 times, and the price of a mechanic by 50 times.
  • According to reports by China Newsweek, there are about 100 companies in China that can produce medical meltblown cloth with a BEF 95 percent (filtration efficiency above 95 percent). 

Supplier Status:

  • Shanghai Dragon Corp, a producer of underwear, has been producing face masks amid the coronavirus outbreak and can now produces millions of face masks every day. Although it is now mainly fulfilling domestic demand, it has been looking into overseas demand given the rapid spread at global level.
  • BGI Group (a leading private genome sequencing company) has received orders for testing over 310,000 people from overseas and those shipments have arrived in 26 countries and regions. 

Regional Supply Dynamics – Masks/PPE


Supply Situation in Other regions:

Indonesia:

  • Indonesian Medical Equipment Association has mentioned that there are seven major surgical mask manufacturers in Indonesia. These companies have increased their production output by 50 to 70 per cent.
  • The Indonesian manufacturers are also bracing for a shortage of raw materials, which are mainly imported from China, the epicentre of the COVID-19 outbreak. The minister mentioned that with the current supply of raw materials, manufacturers should have enough to produce 7.2 million surgical masks.

India:

  • Sales of masks across India doubled to around 1.2 million in February from the usual monthly average of around 600,000, according to All Food and Drug Licence Holders Foundation.
  • The sale of masks, sanitisers, and safety goggles has increased between 100 percent and 400 percent over the past few months

South Korea:

  • According to the Ministry of Economy and Finance in South Korea, around eight million of domestically produced face masks go straight into the public supply per day.
  • The ministry announced that all of the 130 face mask producers have a total production output of around ten million masks per day. 

Supplier Status:

  • One of China’s top oil and petrochemical companies, Sinopec, has launched two production lines for N95 respirators and surgical masks in response to a shortage created by the coronavirus epidemic
  • Sharp will begin manufacturing surgical masks in Japan next month. The production process will begin in mid-March, with a daily output of 150,000 masks.

Japan Supply Dynamics – Masks/PPE


Supply Situation in Other regions:

Japan:

  • The total output of Japanese masks has jumped to 100 million a week.
  • Japanese Prime Minister Shinzo Abe has  called on companies to step up production of masks, and the government will spend 10.3 billion yen (about $94 million) to increase domestic mask production to 600 million units a month by March.
  • Japan's government approves a ban on reselling masks for unreasonable profits. It goes into effect March 15 and aims to ensure a stable supply of the preventative item amid a shortage triggered by the coronavirus epidemic.
  • The Japanese government has decided to provide subsidies to help companies boost production of sterilizing alcohol, which is in short supply amid the coronavirus outbreak.
  • The government says it will bear two-thirds of the costs for relatively large-sized companies, and three-quarters for small- and medium-sized firms. The subsidies will be capped at 30 million yen, or about 286,000 dollars, per production line.
  • METI (Japan) has nominated the following three companies as the first group to be provided with subsidies for installing production equipment by the second week of March:
  • Kowa Company Ltd. for manufacturing masks
  • XINS Co. Ltd. for manufacturing masks
  • Hata Industries for manufacturing components of masks

Supplier Status:

  • Shouhang High Tech Energy will invest 20 million  yuan ($2.9 million) to build a melt-blown non-woven material production line in northeastern Tianjin



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