South Korea’s Dongwha Enterprise Co. is investing $160 million in building a wooden panel plant in northern Vietnam to meet rising demand for furniture and building materials in the construction sector.
The move is its first sole investment in the Southeast Asian country after building a foothold with a local partner in the domestic wood panel market in the southern area, according to a report by The Hankook-Ilbo, a South Korean daily paper.
The company plans to produce medium density fiberboard (MDF) for office and kitchen furniture and interior materials as well as solid wood flooring materials at the factory on a 500,000 square-meter plot of land in Thai Nguyen Province, north of Hanoi.
The facility will have an annual output capacity of 370,000 cubic meters for MDF and 362 million sq. meters of floor materials, and is scheduled to start operation as early as April 2021, the report said.
The South Korean building material maker group established VRG Dongwha MDF Joint Stock Co., a MDF manufacturing joint venture with state-owned Vietnam Rubber Group, in Binh Phuoc Province near Ho Chi Minh City in 2008. It has an MDF production capacity of 300,000 cubic meters per year, according to the company.
The local venture has seized a 40 percent market share in the MDF segment in southern Vietnam, according to the report.