KLK expands oleochemicals processing capacity in China

SHANGHAI (July 11): Deputy Minister of Plantation and Commodities Datuk Chan Foong Hin on Wednesday officiated the launch of Kuala Lumpur Kepong Bhd’s (KL:KLK) new high-purity fatty acids and glycerin plant in Zhangjiagang, Suzhou located in the Jiangsu province of China, bringing the facility’s annual processing capacity to 500,000 tonnes.

The oleochemical complex located on 58 acres of the third-tier city that is about 130km away from Shanghai is owned and operated by KLK’s wholly-owned Taiko Palm-Oleo (Zhangjiagang) Co Ltd (TPOZ). The expansion makes TPOZ one of the largest and most technologically advanced oleochemical production plants in China.

“TPOZ’s expansion is commendable and it’s important to highlight a Malaysian success story in China because this is a very competitive market. Not many companies could go overseas but a lot of companies that went abroad are from the plantation sector. I can safely say that Malaysia is the pioneer for this palm oil industry,” Chan said at the ribbon cutting ceremony on Wednesday.

TPOZ was incorporated in January 2004 while its first plant was commissioned in 2006.

It produces fatty acids, glycerine, soap noodles, triacetin and fatty acid esters. The products are used in various sectors such as daily chemicals, engineering plastics, rubber, textiles, paper, pharmaceuticals and coatings.

“Our journey began with the vision of becoming an integrated player in the oils and fats sector, both locally and internationally. The presence of our facility in Zhangjiagang has been pivotal in realising this vision. It has enabled us to cater to a growing market, catering to both domestic consumption and international export,” said Kow Tiat Yong, deputy CEO of KLK OLEO, KLK’s oleochemicals manufacturing division.  

“Our objective has always been clear: to enhance our production capacity and seize the opportunities presented by the burgeoning market in the People’s Republic of China, a country with a vast and dynamic economy,” he added.

KLK declined to disclose the capital expenditure for the new plant, saying it needed to preserve its position in China’s highly competitive oleochemical market.  

Chan was in Shanghai for a working visit to promote Malaysian palm oil and pepper.

The working visit was organised by the ministry, in collaboration with Palm Oil Research and Technical Service Institute of Malaysian Palm Oil Board.

 

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