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CCM PGW1 plant to be fully operational by Q3

KUALA LUMPUR, May 28 (Bernama) -- Chemical Company of Malaysia Bhd (CCM) will be reactivating and operating its Pasir Gudang Plant 1 (PGW1) by the third quarter of this year (Q3 2019) with a 50 per cent increase in capacity.

CCM group managing director Nik Fazila Nik Mohamed Shihabuddin said the additional capacity would help accelerate the growth of the company further.

“CCM was recently awarded a three-year contract by Petroliam Nasional Bhd (Petronas) for the supply of a maximum volume of 351,000 metric tonne of caustic soda to Petronas Refinery and Petrochemicals Corporation Sdn Bhd, with an estimated contract value of RM315.9 million,” she told a press conference after the company’s annual general meeting here today.

She added that the manufacturing of caustic soda is one of the largest revenue contributors to CCM’s chemical business and the involvement in the refinery and petrochemical integrated development project will enable it to realise a bigger share in the caustic soda market.

“We are grateful that till now we managed to sell 100 per cent of what we have produced. With the increased capacity of PGW1, we will be able to produce more, hence, increasing our revenue,” she said.

On the outlook, Nik Fazila said that the price of chlor-alkali (by-product), namely caustic soda, is expected to remain soft as the global level flows and tightness in production capacities have stabilised.

“In the first quarter of last year, the price of caustic soda was at its peak at US$680 per dry metric tonne. However, the price has plummeted to US$332 per dry metric tonne due to pressure from Iran’s attempts to undersell suppliers in Southeast Asia, as well as India’s new ruling on licensing,” she said.

She added that the besides its chemical segment, its polymer division will focus on the highly-niche market segment and is currently the leading supplier of polymer coating products.

“The global demand for gloves remains resilient. Based on (industry) forecast, the demand is expected to grow between eight and 10 per cent per annum over the next two years, resulting in demand for approximately 40 billion pieces of gloves per annum,” she said.

However, the industry faces difficulties such as the weakening ringgit against major foreign currencies which will result in fluctuating raw material costs.

“We will continue to embark on production automation to pare down costs, and at the same time we are committed to reduce our total energy consumption at our plants,” she said.

-- BERNAMA

 

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