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August 19, 2016 02:00 AM

Bag-making equipment demand grows in SE Asia, thanks to shifting garment production

Kent Miller
Correspondent
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    Kent Miller
    Lin Chun Wei says that as garment production moves from China to lower cost countries, bag manufacturing to supply the garment industry is moving too.

    Taipei, Taiwan — Ye I Machinery Factory Co. Ltd., a longtime fixture of the Taiwanese extrusion machine industry, will focus on the ASEAN nations, especially Indonesia and Vietnam, in the coming year.

    Taiwan's exports of plastics and rubber machinery plunged 10.8 percent last year to $1.12 billion, but one bright spot was Vietnam. Exports to that country climbed 13.8 percent to $123 million, “with extrusion machines up a whopping 239 percent,” Taiwan Association of Trade Machinery Chairman Alan Wang said at the TaipeiPlas opening news conference.

    One big reason behind Vietnam's hunger for bag-making machinery: cost-conscious global clothing manufacturers are shifting production into lower cost regions like Vietnam, said Lin Chun Wei, Yei I sales manager. “In China, the salaries are up. So many factories are moving to Vietnam. The salaries are lower there,” Lin said.

    “Twenty years ago, Hong Kong made clothes. So they needed to make [polypropylene] clothes bags. … Then the factories moved to Guangdong or Fujian [provinces]. Now, they are moving to Vietnam,” Lin added.

    At the company's expansive TaipeiPlas booth, two big machines are on display. An ABA three-layer blown film machine sandwiches a layer of recycled material between layers of all-new high density polyethylene, is gaining new popularity by cost-conscious customers. A recycling line for clean factory waste does shredding, extruding and pelletizing duties for HDPE, low and linear density PE, polypropylene, EVA, ABS and polystyrene.

    Founded in 1960, Ye I runs two factories in Tainan, one that makes screws and the other that assembles the machinery. Eighty-five percent of its sales are exports. Currently, its biggest markets are Russia, Eastern Europe and Turkey, but the company also sells to Latin America, Africa and the Middle East.

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