Yongjin Technology Group, a leading name in China’s stainless steel industry, has announced plans to build a new Yongjin stainless steel plant in Türkiye. Partnering with two other Chinese firms, the Zhejiang-based company will invest CNY1.9 billion (about USD257 million) in the project.

Project factsheet

Company: Yongjin Technology Group

Location: Yalova Machinery Specialized Organized Industrial Zone, Türkiye

Total investment: CNY 1.9 billion (approx. USD 257 million)

Project type: New Manufacturing Facility

Production capacity: 400,000 tons per year

Products: Cold-rolled stainless steel sheets and strips

Construction period: 24 months

The new factory will rise in the Yalova Machinery Specialized Organized Industrial Zone, a fast-growing industrial hub in northwestern Türkiye. Once it opens, the plant will produce 400,000 tons of cold-rolled stainless steel sheets and strips every year.

The production will be split between high-end and more general-purpose products. Specifically, one of the two production lines will focus on crafting 80,000 tons of premium stainless steel, while the other will take on 320,000 tons aimed at broader applications.

Yongjin’s choice to invest in Türkiye highlights the country’s vital role as a manufacturing and export hub. Nestled between Europe and Asia, Türkiye provides easy access to major markets in the European Union, where there’s a strong demand for top-notch stainless steel products, particularly in industries like automotive, home appliances, medical equipment, and construction.

By setting up a production facility in Türkiye, Yongjin can take advantage of favorable trade agreements, including Türkiye’s customs union with the EU, which allows for tariff-free access to the European market for a variety of industrial goods. This strategic move is anticipated to boost Yongjin’s competitiveness in Europe, lower logistics costs, and strengthen supply chain resilience in the face of ongoing global trade challenges.

To finance and oversee the project, Yongjin plans to establish a joint venture, keeping an 80% majority stake. Its two unnamed Chinese partners will hold minority stakes of 15% and 5%, respectively.

The new stainless steel plant will create hundreds of local jobs. Plus, it will promote technology transfer and support related industries in Türkiye. Overall, the project plays a big role in boosting the country’s manufacturing sector and reducing its reliance on imports.

Türkiye’s government is working hard to attract foreign investment in high-tech and value-added industries. Its goal is to raise the country’s share of global FDI to 1.5% by 2028. Yongjin’s move could encourage other global manufacturers to follow and tap into the same opportunities.

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Yongjin Technology Group stands out as one of China’s top producers of cold-rolled stainless steel. Their products find a home in a variety of industries, from household appliances to automotive manufacturing and healthcare.

In 2023, the company churned out over 2.8 million tons of stainless steel, with international sales bringing in CNY4.1 billion, which accounts for more than 10% of their total revenue. Among their key global clients is the Turkish multinational Arçelik A.Ş., known for its well-known home appliance brands like Beko and Grundig.

Yongjin runs five factories in China and two in Vietnam. Now, it is planning a new plant in Thailand. This steady expansion shows Yongjin’s drive to grow from a top Chinese manufacturer into a major global player.

Following the announcement, Yongjin’s shares [SHA: 603995] edged up 0.5%, closing at CNY21.26 (USD2.90) on the Shanghai Stock Exchange. At one point during the day, the stock climbed as much as 1.4%, beating the Shanghai Composite Index, which finished 0.2% higher. This positive reaction shows investors are confident in Yongjin’s global expansion plans and its push for new revenue beyond China.

Yongjin expects to complete construction in about 24 months. Once the plant is up and running, it will help Türkiye strengthen its position as a manufacturing hub for Europe and the Middle East.