Formosa Plastics Group (FPG, 台塑集團) yesterday said a steel factory in China’s Fujian Province that its subsidiaries own half of is to be completed this quarter, with mass production slated to start toward the end of next quarter despite poor local industry conditions.
“The construction of the factory will be completed by this quarter, and it will take one to two months of testing before it starts commercial production,” a Formosa Plastics Corp (FPC, 台塑) official said by telephone.
The remark came after the Chinese-language news site Chinanews reported yesterday that the construction of Fujian Fuxin Special Steel Co (福建福欣特殊鋼廠) would be completed on May 12.
The official, who declined to be named, did not confirm the date.
Commenting on the steel market in China, he said that oversupply was keeping prices low, but the market conditions for high-end steel products were still good.
FPC owns a 25 percent stake in the venture, while another FPG unit, Formosa Heavy Industry Corp (台朔重工), also owns 25 percent, with Chinese investors having the remaining 50 percent, he said.
FPG has invested US$1.3 billion in the factory, which has the capacity of making 720,000 tonnes of hot-rolled stainless steel products a year, he said.
The official did not specify how the new factory would benefit FPG, which reported a first-quarter revenue of NT$50.04 billion.