Yuen Foong Yu Paper Manufacturing Co Ltd (永豐餘) said yesterday it was planning to invest between US$200 million and US$300 million over three years to expand its Yangzhou complex in Jiangsu Province to tap into China’s fast-growing industrial paper market.
“Strong demand in China has prompted Yuen Foong Yu to speed up the pace of its effort to boost its production capacity in China,” a company spokeswoman said. “We are planning to increase annual production capacity at the Yangzhou base from 450,000 tonnes to 1 million tonnes within three years.”
The company has invested NT$7 billion (US$218 million) in the Yangzhou complex, which started industrial paper production at two plants in April 2007.
Industrial paper is used to make packaging for products, such as computers and beverages.
Under its new investment plan, Yuen Foong Yu will build a third plant in the Yangzhou complex and the company’s board of directors will soon discuss the project and map out further details of its implementation, the spokeswoman said.
She said Nippon Paper Group Inc was expected to invest in the Yangzhou expansion plan, but the details of the cost have not yet been finalized.
Nippon Paper paid US$110 million in March for a 20 percent stake in Yuen Foong Yu’s unit, YFY Cayman Corp, which will now be the source of its new investment in Yangzhou, she said.
“Eyeing the huge Chinese market, our Japanese partner wants to take advantage of Yuen Foong Yu’s investment experiences in China,” the spokeswoman said.
According to its Web site, Yuen Foong Yu also has production bases in other Chinese cities, including Guangzhou, Zhongshan, Xiamen, Qingdao, Shanghai, Kunshan, Suzhou, Nanjing, Tianjin, Fuzhou, Dongguan and Jiaxing.
Apart from China, Yuen Foong Yu owns overseas production lines in Vietnam.
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