Sun Paper plant, other Chinese operations not yet open in Arkansas

Three Chinese manufacturers from the Shandong Province that announced plans to locate in Arkansas following one of Gov. Asa Hutchinson’s frequent Far East trade missions have not yet moved out of the development stage.

In April 2017, AEDC announced that Pet Won would invest $5 million to locate a new pet-treat facility in Danville that would create 70 new jobs at a former 28,887-square-foot facility formerly owned by Petit Jean Poultry.

A month later, Ruyi announced it would locate its first manufacturing operation in North America in the Forrest City, creating up to 800 jobs that will pay more than $15 an hour when operational. The company, which is China’s largest cotton textile manufacturer, is investing $410 million to retrofit a 1.4 million square foot cotton-spinning, garment factory in the Delta town.

In May, AEDC’s Preston made an unannounced trip to Shandong Province to meet with executives at Sun Paper, the Chinese paper goods conglomerate that first announced plans in April 2016 to invest more than $1 billion to build a bio-products mill in South Arkansas that will create 250 new jobs at an average salary of $52,000 a year.

Preston’s trip came after January’s announcement by Sun Paper that it planned to boost its investment at the proposed Arkansas mill from around $1.3 billion to $1.8 billion, adding another 100 jobs to the Clark County economic development project. Sun Paper officials said the Arkadelphia plant will now produce linerboard, one of the two products used to make cardboard boxes.

The product switch was made to keep up with the demand for cardboard boxes, in part due to the increase in next-day delivery and online shopping, company officials. That also led to a delay in the company’s protracted environmental permitting process with the state Department of Environmental Quality for air and water discharge at the paper mill.

AEDC spokeswoman Brandi Hinkle said the Chinese paper goods giant is close to completing the last of four permit applications that must be approved by ADEQ before construction can begin on the South Arkansas project.

At a pen-and-pad press event at the governor’s State Capitol office on June 7, Hutchinson said Preston’s recent Far East trip was partly to shore up concerns that the Chinese trade officials had with President Donald Trump’s escalating rhetoric to impose around $200 billion in tariffs on imported goods from the Far East country.

Beijing government officials have also recently put some restrictions on large, heavily leveraged projects by Chinese companies in the U.S., something Hutchinson mentioned in speaking with reporters about the state’s pipeline of ongoing economic development deals with Shandong Province companies.

“That’s what we are looking at carefully as to what impact the (Trump) tariffs have on the cost of developing and continuing those investments,” said Hutchinson. “We have been assured by Sun Paper that they are fully committed to the project (although) there is some concern about the tariffs. But that was part of the discussion with the (Chinese) trade ambassador that hopefully we worked through those issues.”

One Chinese company has opened a facility in Arkansas. Tianyuan Garments Company began producing goods for Adidas in January in a facility at the port of Little Rock. Company officials have. said they would invest more $20 million and bring 400 jobs paying an average of $14 an hour with benefits to the Little Rock area.

“They are up and running with just a little under 100 employees. They are still hiring and working to fill those jobs,” LRPA Executive Director Bryan Day told Talk Business & Politics on June 21.