Chinese WPC startup sees opportunities locally

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: November 6, 2012 6:00 am ET

Zieggy Zhang, GM of Ningbo Helong, at the company's factory in Ningbo (Plastics News photo by Steve Toloken)

Related to this story

Topics Consumer Products, Construction, Materials, Suppliers

NINGBO, CHINA (Nov. 6, 12:15 p.m. ET) — Hoping to take advantage of China’s growing local market for wood-plastic composite decking and other products, a startup Chinese manufacturer has invested 90 million Chinese yuan ($14.3 million) in a new extrusion factory in Ningbo. 

Ningbo Helong New Material Co. Ltd. opened the factory in May, and plans to focus a majority of its initial capacity of 44 million pounds a year on China’s domestic market because it sees growing familiarity and acceptance of WPC, said General Manager Zieggy Zhang.

“In past years people in China did not know about WPC but in recent years WPC factories have shown their products to people with advertisements and [trade] shows, and more and more people know about WPC,” Zhang said, in an interview at the China Sixth International Forum of WPC, held Nov. 3-4 in Ningbo.

He said about 60 percent of its initial production will be targeted to the domestic market, which puts the company somewhat at odds with the traditional export focus of Chinese WPC manufacturers like Helong, which use polyethylene as their main plastic raw material.

Historically exports have accounted for about 70 percent of the industry’s sales, but the domestic share of the Chinese production has been growing.

The main driver for China’s domestic wood-plastic composites market is government projects like parks and public buildings, rather than individual homeowners or buildings as in North America, which is the world’s largest market for WPC, Zhang said.

Also, a high percentage of Chinese urban residents live in apartments, and those in single-family homes that might be potential customers for decking or other outdoor products are in rural areas and generally don’t have as much money as city dwellers, Zhang said.

Helong is targeting about 50 million yuan ($7.9 million) in sales this year and 120 million yuan ($19 million) in 2013. It has 21 Chinese-made extrusion lines at the Ningbo factory, Zhang said.

The company plans to expand capacity to 110 million pounds a year within two years, and as it expands it wants to have its sales evenly split between domestic and international business, Zhang said. It’s targeting Asia and Europe as its main export markets, he said.

The company’s raw materials are recycled PE, sourced mainly from Central and South America and South Africa, along with either wood flour or rice husk.

Helong held a factory open house Nov. 4 in connection with the Ningbo forum, which was organized by the Wood Plastic Composites Committee of the Beijing-based China Plastic Processing Industry Association.


Comments

Chinese WPC startup sees opportunities locally

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: November 6, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

Tessy investing $10 million in new plant, infrastructure

July 30, 2014 4:57 pm ET

Tessy Plastics Corp. continues to buy factory buildings in upstate New York — acquiring a 112,000-square-foot former Honeywell building in...    More

Image

North American robot sales set record

July 30, 2014 4:46 pm ET

The North American robotics sector is off to its fastest start ever, shattering last year's first-half record, with a first-half 2014 of 14,135...    More

Image

Pressure is on to replace aging gas pipes

July 30, 2014 2:47 pm ET

Polyethylene is the plastic replacement material of choice for modernizing the natural gas distribution system — so much so some are concerned...    More

Image

Styrolution will open new production late 2014

July 30, 2014 12:54 pm ET

Germany-based styrenic materials group, Styrolution, has announced it is expanding its facility in Ludwigshafen, Germany.    More

Image

UMass Lowell hosts collaborative research meeting for future projects

July 30, 2014 11:54 am ET

The University of Massachusetts at Lowell recently hosted a seminar, which was billed as a collaborative research meeting between Dow Chemical Co., th...    More

Market Reports

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Shale Gas Market - Analysis of North American Region

This report highlights the impact of shale-based natural gas on the North American plastics market and features an in-depth analysis of production trends in the United States during 2013 and a forecast for 2014 and beyond.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events