Dongwha begins construction of MDF manufacturing plant in Hanoi

Korea’s leading wood materials manufacturer Dongwha Enterprise has begun construction of its production facility in Hanoi, Vietnam.

Located in Thai Nguyen province near Hanoi, the plant will manufacture mainly laminate flooring and medium-density fiberboard (MDF) used in furniture.

Dongwha Enterprise held a ground-breaking ceremony for its new facility on Wednesday (April 22).

A total 180 billion won (US$0.15 mill) has been invested in the plant which covers 50,000 square metres. Besides production facilities, dormitory and education facilities for workers and their families will also be built.

The manufacturing plants for laminate flooring and MDF are expected to be completed in April and August next year respectively. The targeted annual capacity is 370,000 cubic metres for MDF and 3.62 million square metres for laminate floor.

The plant is also expected to produce 1.07 million cubic metres of MDF, in collaboration with VRG Dongwha in Ho Chi Minh City, a joint venture between Dongwha International and Vietnam Rubber Group (VRG). VRG is a state-own conglomerate and a leader in Vietnam’s rubber plantation and processing industry in Binh Phuoc. With the new plant, Dongwha will establish its presence as a dominant player in Vietnam’s MDF manufacturing market.

The construction business boom in northern Vietnam presents a good opportunity for Dongwha, with Hanoi carrying out a large-scale city development project in its northern area.

General Manager Kim Myung-sik of Dongwha Vietnam said the distance between the southern part and the northern part of Vietnam is 1,700 kilometres and VRG Dongwha had difficulties satisfying the market demands in the north.

“Through the construction of our plant near Hanoi, we will take occupation of the MDF and laminate floor markets in the north while solidifying our status as a leading player in the wood board and construction material sectors here,” said Kim Myung-sik, general manager of Dongwha Vietnam.

Dongwha established a joint venture with VRG in 2008, signifying its entrance into the Vietnamese MDF market. It currently has a 40 per cent share of the MDF market in southern Vietnam.

Based on its 10-year relationship with the Vietnamese government, Dongwha Enterprise earned the approval to build its production facility line in Hanoi last July.

(Image is credited to Dongwha Enterprise)