China Tongcheng Tianbai Plastic Co.,Ltd.

As wood plastic composite products gain popularity in China, machinery manufacturers are forecasting rapid sales growth in the next few years, but one of them also warned of overheated investment.

China Tongcheng Tianbai Plastic Co.,Ltd. of Anqing, Anhui province has shifted its market focus from overseas back to China during the past two years, because of the great potential in the domestic market. As part of the global trend toward sustainable development, the government and industry associations in China have been encouraging WPC products.

According to sales manager Mr.Hu, in order to meet potential demand in the Chinese market, the industry needs about 20,000 production lines, while there are currently fewer than 5,000 lines in operation.

“We are very optimistic, and we believe China will become a huge market,” Hu said, adding that the wood plastic composite industry is still in early stages in China.

The company used to ship most of their machines to overseas markets, but sales in China have been picking up quickly since 2008. As a result, overall sales reached 179 million yuan in 2010, and 2011 sales are exceeding original forecast, achieving about 130 million yuan to date.

2008 was a turning point, as the government decided to use WPC products for the Beijing Olympics, and later for the 2010 World Expo in Shanghai and the Asian Games in Guangzhou.

Shandong Tongjia Machinery Co. Ltd. also expressed optimism. Liu Yuduo, a sales executive, said the company sold about 150 WPC production lines in 2010, and expects to double that number to about 300 lines in 2011 – of which more than 200 will be installed in China.

He said most customers are still testing the waters with several production lines, but he expects these companies to expand production later.

Meanwhile, Hu said the Tianbai Plastic has noticed some overly aggressive investment activities in this area, using an unnamed client in Hongkong as an example. “The company has expanded to 200 lines in just two years, too fast to assure product quality. Customers are returning flawed products, among which many are from overseas.”