Karex, the world's biggest condom producer, plans to raise prices by 20% to 30% due to disruption linked to the closure of the Strait of Hormuz, according to multiple reports. The Strait of Hormuz has been effectively shut for two months and remains subject to a blockade by the US Navy, severely impacting global shipping routes.
Demand for condoms has surged by 30% this year, according to multiple reports. Karex's shipments to Europe and the US are now taking close to two months to arrive, twice as long as before the Iran war. Despite the disruptions, Karex has enough condoms stockpiled to meet demand over the next few months. The company is working to manage the supply chain challenges and ensure product availability. The prolonged shipping times have forced Karex to adjust its logistics and inventory management to avoid shortages in key markets.
The situation is definitely very fragile, prices are expensive.
Rubber prices have jumped by 8.5% in the past month, driven by rising oil prices, according to multiple reports. Karex supplies condoms to major brands including Durex and Trojan. Goh Miah Kiat, Chief Executive of Karex, said: 'The situation is definitely very fragile, prices are expensive.' The rising input costs are a key factor behind the planned price increase. The company is also facing higher transportation costs due to the rerouting of shipments around the conflict zone.
Karex plans to increase output to cope with demand triggered by US government cuts to foreign aid. The Trump administration slashed funding for USAID by 92%, equal to $54bn (£43bn), as part of an 'America First review of spending', according to the Trump administration. Goh Miah Kiat noted: 'We're seeing a lot more condoms actually sitting on vessels that have not arrived at their destination but are highly required.' The company is ramping up production to meet the heightened demand from aid organizations and other buyers. The cuts have led to a surge in orders from non-governmental organizations seeking alternative supplies.
We’re seeing a lot more condoms actually sitting on vessels that have not arrived at their destination but are highly required.