Heng Huat commissions new production plant to boost capacity

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Chow (third right) signs a plaque to signify the launch of Heng Huat’s new plant. Also seen are Choon Seng (second right), Heng Huat deputy managing director Kee Swee Lai (right), Jawi assemblyman H’ng Mooi Lye (left), and Penang State Speaker Datuk Law Choo Kiang.

PULAU PINANG: Heng Huat Resources Group Bhd (Heng Huat) has launched its new massive Coconut Fibre production plant in Setiu, Terengganu which is expected to deliver over RM3.6 million in revenue to the group, moving forward.

Following the opening of this plant, Heng Huat has emerged as Malaysia’s largest coconut fibre producer, with an estimated market share of 80 per cent.

The opening ceremony was graced by Penang’s Chief Minister Chow Kon Yeow.

Heng Huat Resources Group Bhd managing director Datuk H’ng Choon Seng said: “The opening of this production plant is part of a continuing effort to capture a larger share of the domestic market and potential export business for coconut fibre and coco peat.

“The strategic location, which would ensure a huge amount and constant supply of raw materials such as coconut husks at a cost-effective price, augurs well for the financial performance of Heng Huat. This is given that the transportation cost will be reduced significantly as the distance to the factory is much shorter, as compared to Terengganu to Penang.”

The plant has a size of 20,230 sqm, with a production capacity of 150 mt/month and 240 mt/month for its coconut fibre and coco peat, respectively. Setiu covers an area of approximately 130,436.30 hectares or 10.07 per cent of the land of Negeri Terengganu Darul Iman. Agriculture is Setiu’s main economic activity, primarily planting of coconut tree, palm tree and rubber tree.

“In the long term, we foresee that once the East Coast Rail Link (ECRL) project is ready, we can leverage on it to deliver our products directly to Port Klang for export purposes,” Choon Seng said.

On Sept 5, 2019, Heng Huat acquired 97 per cent equity interest in Sabut Kelapa Terengganu Sdn Bhd (SKT), who is the owner of this production plant.

SKT has been awarded a tax holiday incentive from the government for tax exemption on operational income for 10 years.