Malaysian forestry and timber company BTM Resources Bhd plans to begin plywood production this year, encouraged by the continued increase in demand for plywood and rising prices globally.
Malaysian news agency Bernama quoted a company official saying the business was expected to contribute substantially to the BTM’s earnings, especially with an expected increase in demand from Japan for the reconstruction of areas affected by the tsunami and earthquake in March.
The company has recently obtained a mandate from shareholders to proceed with a log supply agreement between its wholly-owned subsidiary, Besut Tsuda Wood Products Sdn Bhd, and a related party, SPPT Development Sdn Bhd.
Shareholders also approved an outsourcing agreement between Besut Tsuda Wood and another related party, Gimzan Plywood Sdn Bhd.
Under the log supply agreement, SPPT Development will supply logs to Besut Tsuda Wood for five years. The outsourcing agreement gives Besut Tsuda Wood the right to supply the logs to Gimzan, which will undertake plywood processing on behalf of Besut Tsuda Wood.