Nippon Denko to Expand Ferromanganese Output

Nippon Denko will increase the investment by 1 billion yen to 2.5 billion yen for the parent company for 2007 from 2006. The firm expands the no.2 electric furnace at Tokushima plant for 1 billion yen to increase the output capacity of high carbon ferromanganese by 10% to 220,000 tonnes after expansion of no.1 electric furnace in 2009. The high carbon ferromanganese sales were record 191,000 tonnes in 2006 after the 25% expansion to annual 200,000 tonnes of capacity at Tokushima. The firm will expand the capacity by 10% to increase supply when Nippon Steel and other users increase the steel output. The firm increases the silicomanganese output to 40,000 tonnes at Chinese plant in 2007 compared with just more than 10,000 tonnes in the first year of 2006. The firm increases the operation rate toward 50,000 tonnes of full capacity for early profitable operation. The firm also improves the profitability of ferrovanadium joint venture in South Africa by linking raw material purchase price to product selling price. The joint venture purchased vanadium pentoxide at market price but the margin with product selling price expands widely and gets negative as 2006. With the linkage purchase system, the firm can secure stable profit without negative margin. The firm increases the investment to 3.3 billion yen mainly for new materials business unit in 2008. The firm tries to expand the non-ferroalloy businesses for profit growth while the expansion of the core business of ferroalloy.