Local Plastic Producers Suffering from Material Price Hike

Local Plastic Producers Suffering from Material Price Hike 

With material costs increasing by between 30-45 per cent, plastic producers in Vietnam have been suffering heavy losses.

As the price of plastic grains is standing at US$1,130 per ton, plastic producers could raise prices by at least 15 per cent to cover production but have refrained from doing so to stay competitive against Chinese products.

Ly Ngoc Quang, Director of the Duy Thanh Plastics Company, said he is instead reducing production by 40 per cent to reduce losses. “We will focus on the products of our advantages,” he said.

Other plastics companies shared the same view, saying that they would not raise prices.

According to Nguyen Dang Cuong, Secretary General of the Plastics Association, many workshops are running at indifferent levels, though none have announced shutting down their operation so far.

According to Mr Cuong, the association’s member companies are considering setting up an alliance to avoid price dumping and unhealthy competition, as only workshops equipped with modern machinery and advanced technology can cope with the current difficulties.

Vietnam earned US$73 million from exporting plastic products in the first quarter of this year, up 63 per cent against the year-earlier period. The country spent US$296 million on importing 247,000 tons of plastic in the period, up 27.8 per cent in terms of value and down 0.7 per cent in terms of volume.

VietnamNet