Export Orders of Plastics Products Are Increasingly Shifting From China to Vietnam

Export orders of plastics products are increasingly shifting from China to Vietnam due to rising production costs in China, according to the Vietnamese newspaper Tuoi Tre (the Youth). When I saw the report during Chinaplas, I decided to go speak with Vietnamese exhibitors at the largest plastics fair in Asia. To my surprise, among the 2, 600-plus exhibitors at Chinaplas 2012, only one came from Vietnam - European Plastic Joint Stock Co. The materials supplier is based in Hanoi and operates a factory in Duy Tien, Hanan province. Nguyen Anh Tuan, regional sales supervisor, said he is seeing the trend rising in his country. "Many companies from Taiwan and mainland China are investing to set up production in Vietnam for more competitive labor costs. " The number of plastic orders received by Vietnamese processors has increased sharply since the beginning of this year, and most of plastic exporters are already booked until August, the Tuoi Tre report quoted the Vietnam Plastic Association (VPA) as saying. VPA said Chinese plastic products' prices are comparable to Vietnamese ones' while the Vietnamese plastic products' quality is considered higher. However, the Chinese exporters I spoke with at Chinaplas disagreed with that. They believe the cost in Vietnam is lower, but the quality of Chinese products is better. Lawrence Chang, Asia Pacific sales director of DuPont Performance Polymers, shared with me his observation in an interview at Chinaplas. He said plastics processors are building capacity in lower cost regions such as Vietnam and Indonesia, but they are retaining their China factories. Vietnam's plastics export reached $360 million in the first quarter, 25.6 percent higher than a year ago, VPA said. Source: plasticsnews.com