Formosa Plastics Corp (台灣塑膠), the flagship entity of Formosa Plastics Group (台塑集團), yesterday said that it would build a new manufacturing site in Texas at a cost of US$207 million.
When completed, the plant would have an annual capacity of 100,000 tonnes of alpha olefins, which are used to make high-density polyethylene (HDPE), among other products, the company said.
About 63,000 tonnes would be used by Formosa Plastics, while the remaining 37,000 tonnes would be sold on the international market, it said.
Photo: CNA
The projected completion date of the plant is October 2025, and mass production is scheduled for December that year after a trial run, the company said.
One of the company’s goals in building the plant in Texas is to secure raw material supply for the production of HDPE, it said, adding that alpha olefins are in high demand worldwide.
Citing a recent report by market information advisory firm IHS Markit, Formosa Plastics said that demand for alpha olefins in North America is expected to hit 915,000 tonnes in 2025, but supply would be only 878,000 tonnes.
The new Texas investment is to be funded by a loan of about US$138 million and capital injection of US$70 million in its fully owned US-based subsidiary Formosa Industrial Corp.
The group has production sites in Texas and Louisiana, where its four major units — Formosa Plastics, Nan Ya Plastics Corp (南亞塑膠), Formosa Chemicals & Fibre Corp (台灣化學纖維) and Formosa Petrochemical Corp (台塑石化) — manufacture petrochemical products such as HDPE, low-density polyethylene (LDPE), ethylene, propylene, polypropylene and ethylene glycol (EG).
The four units on Friday reported mixed revenue results for last month amid China’s anti-epidemic measures, the Russia-Ukraine war and rising inflationary pressure around the world, according to their regulatory filings.
Formosa Chemicals, which manufactures aromatics and styrenics, saw revenue edge up 0.1 percent monthly and 10.2 percent annually to NT$36.42 billion (US$1.23 billion), as price hikes in response to rising crude oil costs offset the impact of lower sales volume.
The other three companies all saw sequential revenue declines, with Nan Ya Plastics registering the biggest drop of 19.7 percent to NT$29.7 billion, as China’s harsh lockdown measures, the Russia-Ukraine war, planned EG production cuts, and changes in consumption caused by inflation affected sales volume and prices.
Compared with April last year, revenue decreased 14.9 percent, said the producer of electronic materials, polyester products, chemical products and plastic products, among others.
Formosa Plastic reported a 5 percent month-on-month decrease in revenue to NT$25.15 billion, but a 3.2 percent increase from a year earlier. The company blamed the monthly revenue drop on declining sales volume of polyethylene and polypropylene.
Formosa Petrochemical, the nation’s only listed oil refiner, reported that revenue dropped 5 percent month-on-month to NT$65.35 billion, as declining sales at its naphtha cracking business offset rising sales at its refining business.
On an annual basis, revenue increased 40.4 percent because of higher product prices this year, the firm said.
In the first four months of the year, Formosa Petrochemical reported the highest annual increase of 41.9 percent in revenue to NT$250.9 billion, ahead of Formosa Plastics’ 13.2 percent increase to NT$96.15 billion, Formosa Chemicals’ 12.5 percent rise to NT$131.82 billion and Nan Ya’s 5.8 percent growth to NT$131.79 billion, companies’ data showed.
Ryanair, Transavia, Volotea and other low-cost airlines are feeling the financial pain from high jet fuel prices as a result of the Middle East war and are cutting flights. The closure of the Strait of Hormuz has taken a huge chunk of oil supplies off the market, sending the price of jet fuel soaring and triggering fears of shortages that could force airlines to cancel flights. Airlines are not waiting for a lack of supplies to react. “Travel alert: Airlines are cutting thousands of flights right now,” Travel Therapy host Karen Schaler said in an Instagram reel this past weekend.
MANAGING RISKS: Taiwan has secured LNG sufficient to cover 95 percent of electricity demand for next month, UBS said, describing the government’s approach as proactive UBS Group AG has raised its forecast for Taiwan’s economic growth this year to 8 percent, up from 6.9 percent previously, and said expansion could reach as high as 8.6 percent if external energy shocks are avoided. The upgrade reflects a stronger-than-expected first-quarter performance and sustained momentum in artificial intelligence (AI)-driven exports, which UBS said are providing a firm foundation for growth despite geopolitical and energy risks. Taiwan’s GDP expanded 13.69 percent year-on-year in the first quarter, the fastest growth since the second quarter of 1987, the Directorate-General of Budget, Accounting and Statistics (DGBAS) reported on Thursday. On a seasonally
The Fair Trade Commission’s (FTC) ongoing review of Grab Holdings Ltd’s US$600 million acquisition of Foodpanda Taiwan’s operations, announced on March 23, has taken on fresh urgency as industry experts warn that the transaction could embed significant Chinese cybersecurity vulnerabilities into Taiwan’s digital infrastructure through Grab’s deep ties to autonomous-driving firm WeRide (文遠知行). Less than 16 months after the FTC blocked Uber Eats’ direct attempt to acquire Foodpanda Taiwan — citing potential combined market shares of 80 to 90 percent — the emergence of Grab as the buyer has prompted questions about whether the same competitive harm is simply being rerouted
The list of Asian stocks that benefit from business partnership with Nvidia Corp is getting longer, as the region further integrates into the artificial intelligence (AI) chip giant’s business ecosystem. Just in the past week, South Korea’s LG Electronics Inc, Taiwan’s Nanya Technology Corp (南亞科技), as well as China’s Huizhou Desay SV Automotive Co (德賽西威) and Pateo Connect Technology Shanghai Corp (博泰車聯) have become the latest to rally on news of tie-ups, supply-chain participation or product collaboration with the US chip designer. Asian suppliers account for about 90 percent of Nvidia’s production costs, up from about 65 percent last year, data compiled
RSS