KUALA LUMPUR: Evyap Holdings AS, Turkey’s biggest soap manufacturer, is relocating more of its bar soap production to Malaysia to better serve its clients in Asia.
Its subsidiary Evyap Sabun Malaysia Sdn Bhd, has, since 2012, invested more than US$200 million (RM876 million) in a palm oil refinery and soap-making facility in Tanjung Langsat, Johor.
The 350,000 tonne/year facility, Evyap’s first-ever oleochemicals production facility, was commissioned in October 2014. Before this, the group’s manufacturing sites in Turkey and Egypt are more familiar with using animal fats such as feedstock, namely tallow.
The Tanjung Langsat refinery complex is able to produce 150,000 tonnes/year of soap noodles; 175,000 tonnes/year of fractionated fatty acids; and some 25,000 tonnes/year of glycerine. It is currently operating at more than 80 per cent capacity.
“The Malaysian government granted us tax-free status for about 10 to 15 years because this refinery complex serves as our Asian hub,” Evyap Sabun vice-chairman Martin Rudolph said in a media briefing, here, yesterday.
Also present was Omer Fethi Evyap, one of the grandchildren to founder of Evyap Holdings AS Mehmet Rifat Evyap.
“Back in 2011, we were choosing between investing in Malaysia or Indonesia. We decided to put our money here because of political stability and good infrastructure,” said Rudolph.
“We now have 11 lines to produce all variants of soap bars. This year, we’re starting to relocate bar soap-making from Tuzla in Turkey to Malaysia. It will be carried out phase by phase.
“About 50 per cent of the products coming out of this refinery complex are for our own production of downstream consumer goods in Turkey, while the rest are sold to clients in more than 120 countries, he added.
When asked on feedstock for its refinery, he said, “we have different suppliers for crude palm kernel oil (CPKO) in Malaysia and Indonesia. The cost savings in relocating our bar soap production here is significant. We want to be nearer to the emerging markets.”
The third month benchmark crude palm oil (CPO) futures on Bursa Malaysia yesterday fell RM31 to close at RM2,424 a tonne. Price volatility in CPO and CPKO feedstock makes customers hesitant to lock in on long-term contracts.
In response, Evyap is focusing on improving its bar soap products to help boost sales to penetrate new markets.
“Innovation is the key in this current market and the best innovation comes out of necessity in global economic uncertainty,” said Rudolph.
Among Evyap’s toiletry brands are Duru, Arko, Sanino, Evylady, Evy Baby, Aromel, Activex.
“Despite the challenging trading environment, we are optimistic of the future. We believe an integrated player like us is better able to leverage on market opportunities as we have clear understanding of various consumer markets,” he said.