Chinese mask producers' shares get boost as COVID-19 pandemic worsens abroad

By GT staff reporters Source: Global Times Published: 2020/12/22 19:48:04

Pedestrians wearing face masks walk on a street in Hong Kong, south China, Dec. 20, 2020. Hong Kong's Center for Health Protection (CHP) reported 74 confirmed cases of COVID-19 on Sunday, taking its total tally to 8,152. The new confirmed cases included 70 local infections, with 25 cases of unknown origin. (Xinhua/Wu Xiaochu)



Shares of some medical supply companies in China rose by the 10-percent daily limit on Tuesday after the global drive to control the coronavirus took a turn for the worse when the UK reported a mutated strain of the deadly virus.

The gains came amid anticipation of increased demand for medical materials in Europe and North America as countries rush to contain a highly infectious new coronavirus strain by shutting travel links with the UK, and the US Congress approved an $892 billion coronavirus aid package on Monday

Several companies supplying medical goods climbed by the 10-percent daily limit, and medical sector shares overall rose 0.41 percent even as the benchmark Shanghai Composite Index sank 1.86 percent.

Shandong Dawn Polymer Co, a face mask manufacturer, rose 10 percent to 25.85 yuan ($3.95). Shares of medical rubberized fabric and bandage company Jiangsu Nanfang Medical Co closed at 12.78 yuan. 

Cheng Guangqi, chairman of Shandong Haidike Medical Products Co, a maker of masks and protective suits, told the Global Times on Tuesday that there has been an uptick in new orders in recent weeks.

The increase hasn't been too much, at about 10 percent, Cheng said. "Anticipation by traders of medical supplies for more medical goods has been on the rise, on account of the reported mutation of the virus."

However, new order volumes are being held back due to shipping container shortages. With freight rates sometimes five times the usual levels, low-value medical supplies from China are not that competitive, Cheng said.

Chen Hongyan, secretary-general of the Medical Appliances Branch of the China Medical Pharmaceutical Material Association, told the Global Times that there is definitely an increase in orders from pandemic-hit countries, especially as the US and some European countries have encountered the second wave of the outbreak in the winter, and Chinese companies have the capacity to meet these needs both in terms of quantity and quality.

A Chinese trader told Global Times that daily medical material exports to Europe and North America are stable.

"But China has a mature industry and supply chain, so any rise in demand from overseas can be met," said the trader.

A manager surnamed Liu with Hunan Kanerga pharmaceutical Group, which can supply up to 4 million masks each day, told the Global Times on Tuesday that even though the global epidemic continues, there are hundreds of thousands of companies making masks in China, so no company is likely to get a rush of orders.

"It is hard to say if orders will increase next year. Because there are so many mask factories in China, they will not easily increase production," said Liu, whose company has sufficient capacity.

However, out of the 10,000 qualified mask suppliers in China, fewer than 100 have received the FDA or CE markings required by the US and the EU, according to media reports.

An employee with medical equipment registration agent Shanghai Jiushun Enterprise Management told the Global Times that the number of medical equipment registrations for EU standards has been rising, but less rapidly than during the first wave of the COVID-19 pandemic.

Production capacity for surgical masks in China has been ramped up to hundreds of millions per day since spring, according to industry insiders.


Newspaper headline: Mask producers' shares get boost as pandemic worsens abroad


Posted in: INDUSTRIES,BIZ FOCUS

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