A Florida company that saw an opportunity in the shortage of N95 masks when the coronavirus pandemic started has now sold 30 million of them unsold because it cannot find buyers in the United States.
DemeTech, Miami-based factory, blames cheaper prices from China, while wholesaler believes the problem is that American buyers are wary of new manufacturers.
It all started early last year, when China, which produced half of the masks sold in the world, was accused of hoarding them amid the initial terror that sparked the pandemic.
In April, some hospitals with COVID-19 patients reported having masks for just three days, according to a survey by Premier, a company that buys medical supplies for 4,100 hospitals and health centers in the United States.
Google, Amazon and Facebook subsequently banned the promotion and sale of N95 masks on their sites, to prevent nervous users from depleting a vital input for medical personnel.
So DemeTech, a family business that makes stitches, has converted to produce them.
Nine months and tens of millions of dollars later DemeTech N95 gas masks are approved by the federal government, but they don’t have enough buyers.
Luis Arguello, vice president of the company, explains to AFP that there is “an unfortunate gap between the manufacturers and the public that wants to buy the product.”
China and social media
Arguello attributes this “decoupling” to two factors.
First of all, he states: hospitals that buy in bulk prefer to buy them cheaper in China.
A box of 20 DemeTech N95 masks costs $ 75. Although the largest comes out less, the price is still higher than Chinese masks.
“We are significantly more expensive because we use US raw materials and labor.”explains Arguello.
A New York Times report last week identified about two dozen U.S. companies that, like DemeTech, are struggling to sell their N95 masks despite government promises – formerly by Donald Trump and current by Joe Biden – to get the favor production.
Second, local businesses cannot retail their masks because it is impossible for manufacturers to promote them onlinebecause companies such as Google and Facebook prohibit advertising them.
“Most digital companies think they have good reason, because they want to reserve the product for the hospital industry and for doctors,” Arguello says. “But we are on leave, we have a lot of masks in our inventory. There are about 30 million here.”
N95 is considered the safest mask to prevent the spread of coronavirus because it filters 95% of the particles in the air.
Distrust
A year after the outbreak of the pandemic, the N95s have outgrown their initial shortage, but they are still a “limited” resource, explains David Hargraves, vice president of supplies at Premier, the medical supplies distribution company.
Demand is clearly high – the use of these masks is up 500% since July last year – but New manufacturers have also joined and hospitals have an average stock of 150 days.
“However, we have to be careful not to be overly optimistic,” said Hargraves. “Any change in the current level of supply and demand could quickly endanger this very fragile market and put us back into acute shortage.”
For this reason, he explained, the N95s remain a protected source, which explains why technology companies’ advertising ban is enforced.
Premier says it buys masks from both local manufacturers – including DemeTech – and foreign.
But hospitals, the firm says, have the final say in purchases.
Some have to approve the masks within their own inspection system, while others are reluctant to buy from unknown suppliers because of the many scams that emerged with the pandemic.
Meanwhile, Arguello says he is at a “tipping point”.
“Either we will hire 3,000 new workers and continue to create and help the economy,” he says, “or we will have to lay off 1,500 workers who work in mask manufacturing.”