Ta Ann’s new plywood mill for Australian market

Ta Ann Holdings Bhd milling operation.

KUCHING: Ta Ann Holdings Bhd is expected to commission a new plywood mill in Smithton, Tasmania, by next month.

Group managing director Datuk Wong Kuo Hea said the mill would process eucalyptus veneer currently produced by the group’s two veneer mills in Tasmania into plywood products for the Australian market.

He said the prospect of the Tasmanian plywood operation would depend on the Australian construction sector, the strength of the Australian dollar and the company’s success in developing new quality hardwood plywood products to cater to the market there. Another factor hinges with the recovery of the Japanese housing market.

To recap, Ta Ann Tasmania had earlier received a A$7.5mil grant from the Australian government, which is used to fund half of the new plywood mill project.

According to Wong, the company had received good response from the Australian market for its plywood products with “Standardsmark” certification.

“An increasing market share in Australia is anticipated as the double certification of our Form plywood product is building its sales steadily in Australia,” he said.

Among the company’s 2015 action plans is to explore and engage effectively with local Australian business networks to establish a strong customer base in the market there for Bracing and Form plywood.

Wong said Ta Ann was confident of receiving continuous inflow of plywood product orders from Japan as its product quality and specifications meet Japanese customers’ expectations and requirements. He assured that the company would adhere strictly to producing quality and environmental friendly products to cater to demand.

“The weakening yen, which makes Japanese export cheaper, and the on-going infrastructure and construction preparations for Tokyo 2020 Olympics will sustain plywood demand from Japan,” he added in the company’s 2014 annual report.

Wong said the group would focus plywood production on fast moving products, like concrete panels, structural panels and coated plywood panels.

Reviewing the group’s plywood division performance last year, Wong said production volume jumped by 17% to 207,441 cu m from 177,640 cu m in 2013 due to increasing demand in the Japanese market. Last year’s sales volume climbed to 207,508 cu m from 190,633 cu m in 2013 or up by about 9%.

Some 92% of the group’s plywood exports went to Japan, 4% to Australia, 2% to Taiwan, 1% to Singapore and the remaining 1% to other destinations.

On Ta Ann’s sawmilling operations, Wong said demand for moulding products remained strong from the Australian market, and that the company would develop higher value-added products for the existing niche market.

In 2014, Ta Ann expanded its oil palm estates to 39,527ha from 37,267ha in 2013 and had completed the planting of the group’s existing peat land bank.

With the group’s matured estates increased to 30,355ha from 28,209ha in 2013, Ta Ann raised its fresh fruit bunches (FFB) production by 6% to 560,875 tonnes from 528,496 tonnes.

“Mechanical harvesting (of FFB) is applied in larger areas of our estates as part of our strategy to reduce labour.”

Wong said the group second palm oil mill helped to boost crude palm oil production by 63% last year.

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