Guanwei Recycling Corp., China’s largest recycled low-density polyethylene (LDPE) producer, which is German Environment Auditing Association-certified (allowing them access to high quality plastic waste from Europe), disclosed today that the Company has entered this year with twice as many suppliers and an increase of 50% in the number of its customers.
Set to show FY 09 results this month, GURC picked up 90 new customers in 10 different industries in the second half of 09 due in large part to the rebounding Chinese economy – an increase most strongly represented among the Company’s new customers, who are building and infrastructure clients.
Outstripping even this extraordinary increase in the customer base was the growth in the sheer number of suppliers of raw materials, leading GURC Chairman and CEO Mr. Chen Min to directly comment that the explosive demand for recycled plastic “raw material procurement” was the key growth factor for the industry.
Mr. Chen Min noted the increase to 10 long-term suppliers and the addition of some of Europe’s biggest suppliers, including Spain and The Netherlands, as fundamental to reinforcing the Company’s business model, which has historically produced “strong bottom line growth” due to its relative exclusivity as a Chinese recycler which has abundant access to high-quality European process inputs.
Mr. Chen Min was keen to point out the cost advantages, and the ability to produce a higher quality product, which these relationships entailed, and noted that the Company was “reaping the benefits” of having maintained strong ties with suppliers, even profitably navigating price fluctuations and availability during the economic downturn.
“While most were affected by the decline in raw material prices, we maintained timely payments and originally negotiated prices. As a consequence, we have also been able to obtain commitments for increased supplies as the year progresses with some of our original suppliers,” said Mr. Chen Min, pointing to the Company’s high quality recycled LPDE as a perfect solution to a burgeoning demand for plastics.
Mr. Chen Min described GURC’s market position as “very strong for continuing success”, citing the broadening of the supplier base, which offers a large store of resources as ample evidence for big production numbers and big returns on investment for the Company’s shareholders.