Wednesday, September 30, 2020

Foreign investors eye Rayong for new rubber factories

Aug 10. 2020
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Both domestic and foreign investors want to establish rubber glove factories at an industrial estate in Rayong province to meet soaring demand during the Covid-19 crisis, said the estate’s developer.

“We have been recently contacted by Thai Hua Rubber Plc to form a joint venture to establish a rubber glove factory in Lakchai Muang Yang Industrial Estate, starting in 3-5 months after the installation of necessary machinery is complete,” said Lakchai Kittiphol, CEO of Tribeca Enterprise, the estate’s developer. Thai Hua Rubber is the parent company of Tribeca.

“We also have investment partners from the European Union, United States, Malaysia, China, Taiwan and Japan who are willing to invest around Bt20 billion in the rubber glove business, whereas building a medium-sized factory would require around Bt5 billion.”

Foreign investors are eyeing Thailand because of its strong logistics infrastructure and rich raw materials, Lakchai added.

“Although Thailand has higher minimum wages compared to neighbouring countries, the rubber glove industry is hardly affected because most of the manufacturing is done by machine,” he said.

“The company would like to see more support from the government, especially in providing soft loans to entrepreneurs interested in investing in rubber-related industries.”

The rubber price in Thailand has risen since April to Bt40-45 per kilo. The price is expected to reach Bt50 by year-end but not climb beyond a ceiling of Bt70. The main customer for rubber producers – the tyre manufacturing industry – is still stagnant due to economic contraction caused by the virus crisis.

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