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Chinese Textile Manufacturer to Invest $410M, Create 800 Jobs

3 min read

Shandong Ruyi Technology Group on Wednesday announced that it will invest $410 million to remodel the former Sanyo manufacturing facility in Forrest City into a textile factory that will eventually employ about 800 people.

The Chinese company will use the 1.4 million-SF plant to spin Arkansas cotton into yarn, which will be sold to garment manufacturers. It will be the company’s first factory in North America.

Ruyi aims to buy about 200,000 tons of Arkansas cotton per year, according to Gov. Asa Hutchinson, who spoke alongside Ruyi’s chairman, Yafu Qiu, and state economic development leaders during an announcement at the state Capitol. 

At the event, Hutchinson and Qiu signed a memorandum of understanding outlining terms of the deal, which Qiu said will mark “the first milestone of Ruyi’s steps into the United States.”

The company is receiving three incentives:

  • Up to $4 million in grants from the Arkansas Economic Development Commission, dependent on job creation.
  • Create Rebate, an annual cash rebate that is equal to 5 percent of its total payroll associated with the new jobs created. The company will receive the rebate for 10 years.
  • Tax Back, which provides sales tax refunds on building materials, taxable machinery and equipment associated with the project.

Mike Preston, executive director of AEDC, said local economic development leaders provided another $1 million in incentives.

The Sanyo plant, which once made cathode ray (picture tube) televisions, has been vacant since the company ended production there in late 2007. Ruyi aims to start renovations later this year, with construction taking about six months. Production at the 161-acre site should begin in mid-2018, according to the AEDC.

The company envisions two phases of operation. Phase 1 consists of remodeling the existing plant, after which the company would employ about 480 people. Phase 2 would entail new construction at the site, allowing for employment of 320 more people.

Preston said average pay at the plant would be $15.25 per hour.

The plant would provide a boost to the St. Francis County economy, which has a 4.8 percent unemployment rate, according to Hutchinson. 

“This is not only great for Arkansas, but it’s … going to give an economic boost to a region that much deserves it and has worked very hard for it,” Hutchinson said.

More: See a marketing document with photos and other details of the Sanyo site.

Arkansas is the fifth largest cotton producer in the country, producing more than 840,000 bales in 2016, making it a prime location for a plant that Qiu, speaking through an interpreter, said will be modern and use “advanced spinning technology” and equipment.

Still, Preston said Arkansas was in the running with “multiple” states for the plant. 

“It was competitive,” he said.

Ruyi, headquartered in Shandong Province, was founded in 1972. It is the largest textile manufacturer in China and owns the two largest comprehensive textiles and garment industry chains in the world. It has operations in 30 counties, including France, Japan, New Zealand and the United Kingdom. Qiu said that in Australia, it owns the largest cotton base in the Southern Hemisphere, Cubbie Station, which boasts more than 90,000 hectares of cotton.

In all, Ruyi has 30,000 employees, has two publicly traded companies and ranks No. 59 among China’s top 100 multinational companies. It is the latest Chinese company working to establish multimillion-dollar factories in Arkansas.

Shandong Sun Paper Industry is building a $1.3 billion pulp mill plant in Arkadelphia (Clark County) and expects to employ 250 people.

Garment maker Suzhou Industrial Park Tianyuan Garment Co. is spending $20 million to build a factory in Little Rock, and that project is expected to create 400 new jobs.

Pet Won Pet Products is investing $5 million to put a pet treats manufacturing facility in Danville, creating 70 jobs. 

Announcing the Tianyuan plant from China in October, Hutchinson and Preston hinted at future investment by Chinese garment companies in the Delta. Hutchinson said Wednesday that he had been thinking specifically of the Ruyi deal, which he was also negotiating.

“This is something I’ve had in mind for over a year, and after I saw what they produce in China — this is beautiful apparel that they produce — beautiful apparel that will look greater with Arkansas cotton,” he said.

(An early version of this story had the incorrect amount of investment by the company. It is now correct.)

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