Goldsun Group, Taiwan’s largest concrete supplier, will invest 1.2 billion yuan (US$144m) to build two cement production lines in Yongding of East China’s Fujian Province. The company said the move is an important step in expanding its business in the mainland cement market. With an expected annual output of 3Mt, the new plant is to become the group’s largest cement production base on the mainland. Construction of the project’s first production line began last week and will be operational in the fourth quarter of 2006.
The project signals the start of the group’s transition to high-end cement products for its development in the mainland market. The group also plans to establish its sales network in southern Fujian, said Shiaw-Shinn Lin, Goldsun’s board chairman. Goldsun has been investing in the mainland since 2002. It claims ownership of another six cement factories and a concrete plant in Suzhou of Jiangsu Province.
"In recent years, more and more of Taiwan’s cement enterprises have gradually transferred their production to the mainland," said Li Chunsheng, general manager of Goldsun (Fujian) Cement Corporation.
Besides Goldsun, a number of Taiwan’s large cement makers such as Taiwan Cement Corporation, Asia Cement Corporation, Chia Hsin Cement Group and Universal Cement Corporation have operations on the mainland. For instance, Asia Cement Corporation, Taiwan’s second largest cement enterprise, has so far invested more than US$140 million in Shanghai, as well as Jiangxi and Hubei provinces. In addition, the company has decided to build five more cement factories to further expand its domestic production, which is expected to reach an annual capacity of 20Mt on the mainland, even higher than the total annual sales volume of the whole Taiwan cement market.
Lin also said the Chinese mainland is currently going through a golden period and the country was in dire need of high-quality cement for its infrastructure projects, adding that the influx of Taiwanese investment should not hurt the mainland cement market. It is predicted that the mainland’s high-quality cement output will increase to 120Mt in 2005. Competition between Taiwanese and mainland cement enterprises is good for the development of the cement industry, and will help optimise product structure in the domestic cement market and upgrade the whole industry, said Shiaw-Shinn Lin.