8/6/2012 1:10:00 AM
NEWS BRIEFS
Chin Well Banking on Vietnam DIY Market for Growth
Tsai Chi-yun
Malaysia’s Chin Well Holdings Bhd. is expanding steel fastener products range into South-East Asia and Europe despite the weakening global economic climate, the Malaysian Star reports.
The European market was reportedly expected to generate less than 45% of overall group revenue for fiscal 2013, ending June 30, 2013.
“Demand from Italy, France, and Spain has slowed down since last November, while orders from Germany are still maintained,” noted Group director Tsai Chi-yun.
“Thus, we are stepping up production for fasteners under the British Standard Whitworth and Japan Industrial Standard used in different South-East Asian countries, including Malaysia, to penetrate into new growing markets such as the automotive industry in Thailand.”
Slower demand has put downward pressure on wire rod, which has dropped from $800/ton to $760/ton in the last six months, enabling Chin Well to lower its costs and prices.
Tsai told the Star the price of fasteners has dropped 10% to 15% in the past year to $900 to $1,600/ton.
“The key markets are in the United States and Europe. We are now negotiating with European and US customers, who are in the process of auditing the Vietnam operations before placing orders, which in turn expected to be in large quantity.”
Chin Well is counting on DIY business in Ho Chih Minh, Vietnam – which started turning a profit in 2012 – to generate growth for the group over the next two years, producing as much as 40% of overall group revenue by 2014.
Tsai said the group FY12 production is 110,000 tons of fasteners – roughly the same as FY11.
“2013 is also expected to be slow” in the absence of a comprehensive solution to the EU debt crisis. ©2012 GlobalFastenerNews.com
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