Now is an interesting time to be in the Southeast Asia cleanroom market. Whilst markets like electronics and pharmaceuticals are still seeing significant investment, this is being impacted by the wave of domestic onshoring across the region’s target markets.
Selling gloves
Riverstone Holdings, a major glove manufacturer based in Malaysia, has been watching the demand across its cleanroom and healthcare glove sectors with keen interest.
In April this year, the company took questions from shareholders and investors, covering the movements of the business segments and the markets it operates in.
In this Q&A, the price of cleanroom gloves was described as higher than pre-pandemic levels.
ASAP Innovations, another glove manufacturer that opened a regional office in Vietnam this year, said that price rises are mostly because of shortages of materials, such as nitrile, as well as rapidly rising cargo prices from China and Malaysia.
Sean Keller, Managing Director at ASAP Innovations, commented; “We are doing everything possible to minimise disruption to the supply of these vital products. These problems are affecting everyone, so the entire industry must work together to help solve them.”
Demand from the consumer electronics industry continued to be slow due to the sector downturn
All of this is being compounded by the general slowdown in the electronic and semiconductor demand. “Demand from the consumer electronics industry continued to be slow due to the sector downturn,” Riverstone stated in its Q&A.
Ireland-based ASAP Innovations was not the only cleanroom consumables company to open operations in Southeast Asia in recent years.
Cleanroom consumables provider Isofield was founded in 2020 with manufacturing in Malaysia, and distribution in Ireland. “From Kuala Lumpur, the product is shipped to our Isofield warehouse in Dublin, Ireland ready to be distributed to channel partners across Europe,” Managing Director Stephen Morgan told Cleanroom Technology. “We serve our Asian customers directly from the Kuala Lumpur facility.”
This interesting set up is one of the unique aspects of Isofield and provides a big advantage to the company. When it comes to supply chain reliability, this level of control over each step in the process can be a huge selling point for consumers who need to work to precise timelines.
ASAP Innovations’ launch of ASAP Asia targets the cleanroom and healthcare markets, much like Riverstone.
We estimate that the worldwide shortage in gloves is between 20-25 billion gloves per month at present
As of the end of 2021, prior to the launch of its Asia operations, ASAP commented on the nitrile shortage that is plaguing the entire globe. “We estimate that the worldwide shortage in gloves is between 20-25 billion gloves per month at present, and according to the Malaysian manufacturers’ association MARGMA, worldwide demand is projected to rise from 296 billion in 2019 to 330 billion this year. With glove manufacturers flat out currently, this isn’t a deficit that will quickly be resolved.”
Building new facilities
The construction sector has been busy with newly merged Puritas Asgard, and newly rebranded AcroMeta, both winning multimillion-dollar projects.
A $14m high containment biosafety level research lab build for Acromec Engineers, and a $3.7m ISO Class 7 cleanroom Wyeth Nutrition project for Puritas Asgard. Both of these builds were in Singapore, proving the country’s relevance and importance to the region’s cleanroom functions.
But outside of project wins across the Southeast Asia region, there are other exciting innovations, such as those for the modular trend.
In May this year, Singapore and Vietnam-based C-CUBE’s modular cGMP facility production site became fully operational.
The company then used this innovation in a 250 sqm biotech facility in Hanoi.
A rising tide raises all ships
Other forward-thinking initiatives by companies in Southeast Asia included Malaysia-based Medhini Group, which has joined forces with China-based TERAO Asia to advance sustainable and green industrial projects in Malaysia.
In general, those trying to develop clean air and HVAC solutions have shown enthusiasm to develop in Asia.
For example, clean air systems manufacturer Airtech Japan has announced its plans to expand business in the Shizuoka area of Japan.
At the same time, Airtech also established a Kumamoto branch office (sales and distribution warehouse) in Higashi-ku, Kumamoto city in late January.
In order to expand in Shizuoka, the company has planned to open a sales and marketing office for our products in Fuji City, Shizuoka Prefecture. The Shizuoka Branch Office and Shizuoka Service Center will be the base for installation services. The planned opening of this branch is 3rd April 2023.
L&K Engineering Suzhou landed a $205.3 million bid to expand United Microelectronics' semiconductor fabrication plant in Singapore
"In the past, we have sent customers in Shizuoka Prefecture to our Chubu Sales Office (Nagoya City, Aichi Prefecture) or our East Japan Headquarters," the company stated. "However, in the future, we will improve our services to factories in each industry, and increase demand for our products and product maintenance in order to establish a system that can respond immediately.”
As competition for and quality of products increases across Asia, it helps all cleanroom-related businesses in Southeast Asia. A rising tide raises all ships!
What is happening in the hi-tech manufacturing sector?
South Korea and Taiwan are the areas that produce most of the world’s semiconductor supply, however, as discussed earlier, there has been a push worldwide to bring manufacturing of electronics to the countries demanding them.
Though it remains to be seen how successful these efforts will be in places like the US, as an area of the world where a lot of this production was beginning to take place, Southeast Asia’s cleanroom market is already starting to see some slowing in the market in response.
South Korea and Taiwan are the areas that produce most of the world’s semiconductor supply
But it is not all bad news for the region, in March of this year, L&K Engineering Suzhou landed a $205.3 million bid to expand United Microelectronics' semiconductor fabrication plant in Singapore.
L&K evolved from a traditional building and laboratory air condition design and installation company, into a pharmaceutical cleanroom and whole plant design/installation service provider, and finally to a competitive local cleanroom constructor in the high-tech semiconductor industry.
The growth and evolution of L&K closely followed the booming development of the cleanroom industry in Taiwan, and this is a good sign that the market will continue to boom despite outside changes.
Featured companies
- Companies:
- Airtech
- Airtech Japan
- Acrometa
- ASAP Innovations
- Medhini Group
- L and K Engineering
