© 2021 WFAE
90.7 Charlotte 93.7 Southern Pines 90.3 Hickory 106.1 Laurinburg
Play Live Radio
Next Up:
0:00
0:00
Available On Air Stations
Business
See the latest news and updates about COVID-19 and its impact on the Charlotte region, the Carolinas and beyond.

With Vaccines And Change In Guidance, Manufacturers Are Stuck With Surplus Of 'Many Millions Of Masks'

mask-5064244_1920.jpg
Pixabay

EcoGuard started in 2019 as a company that manufactured reusable grocery bags. Based in a converted CD factory in the Cleveland County town of Grover, the company churned out the multi-use totes using a non-woven fabric created by its parent company, Uniquetex.

Non-woven fabric is used in products like sofas, car upholstery, diapers and hospital gowns. It’s made by melting and extruding plastic pellets into a dense set of fibers. It’s also a key ingredient in disposable surgical masks. So, roughly a year after opening, in March 2020, EcoGuard shifted its business model.

“Oh man. So in the beginning, we thought we were doing really great to make about 30,000 masks in a day,” said Russell Shytles, who works in marketing at EcoGuard.

But in the past month or so, face masks have fallen increasingly out of fashion. The Centers for Disease Control and Prevention said fully vaccinated people could ditch their face coverings and states have lifted many coronavirus restrictions. Now companies like EcoGuard are stuck with a surplus of masks and struggling to find buyers.

“We have many millions of masks in inventory,” Shytles said.

Last year, EcoGuard’s mask-making machines were running around the clock, he said, in three different shifts. Hospitals and retailers would pay about 80 cents per mask. Now, the company has the capacity to make up to a half-million masks per day — and sometimes doesn’t even turn on the machines.

The price per mask has dropped to less than 10 cents, according to Shytles.

Staffing has suffered because of the decreased mask demand, too. The number of EcoGuard employees peaked at 80 back in March. It’s since dipped to around 30.

Shytles said the company is in a “weird position” because while it has accumulated a glut of surgical masks, the surplus also seems to signify that the pandemic is under control.

“You (as a business) want to make more. You want to be able to hire more people ... do more with the business,” Shytles said.

But, he added: “You don’t want that to be ... at the expense of someone’s health.”

TAIJI Medical Supplies in Lincolnton is facing similar challenges. Dan Grayson, the company’s vice president of sales and operations, said sales have dropped by around two-thirds in recent months.

“We knew at some point in time this was going to happen,” Grayson said.

But he and others at the company “did not think that the CDC would necessarily change its guidance so soon.” Though it’s not just the latest CDC guidance that’s causing problems, according to Grayson. It’s also foreign mask manufacturers.

“Two months ago, (they) were dumping masks at the ports for a penny and a half each,” he said. “And there’s no way an American manufacturer can manufacture and make a profit out of a penny and a half on a mask. It’s absurd.”

Mask-makers across the U.S. have made similar complaints. Twenty-six companies recently created a trade group called the American Mask Manufacturer’s Association. They wrote a letter to President Joe Biden in May, accusing China of “changing the rules and effectively dumping masks on the U.S. market” at “well below” the cost of production. The group argues that this behavior has left 260 million American-made masks “sitting unused in warehouses.”

In the letter, the Mask Manufacturer’s Association urged the federal government to purchase the surplus of American-made masks to rebuild the Strategic National Stockpile. The group has also said it plans to file an unfair trade complaint with the World Trade Organization.

Both Shytles and Grayson said they hope that their mask-making companies will continue to operate in the future because of continued business with some hospitals and retail stores.

Want to read all of WFAE’s best news each day? Sign up here for The Frequency, WFAE’s daily email newsletter, to have our top stories delivered straight to your inbox.