Summit Showa Aluminum, Japanese major secondary aluminium alloy maker jointly controlled by Sumitomo Corporation and Showa Denko, plans to increase its secondary aluminium alloy production by 3.6% to 116,000 tonnes in fiscal 2012 started in April from fiscal 2011. The firm forecasts the alloy demand would maintain steady when domestic car production would increase along with Japanese government’s programs to stimulate purchase of environment friendly cars.
The firm’s secondary aluminium alloy output decreased by 8.2% to 112,000 tonnes in fiscal 2011 from fiscal 2010. The demand temporarily dropped down due to the Japan Earthquake and Thai flood disaster. Domestic alloy sales were also impacted by the increase of imported alloys under historically strong yen trend. However, the firm could regain annual profit for the first time in 4 financial years. Aluminium scrap cost maintained relatively low. The firm’s cost cut efforts also contributed to better profitability. In fiscal 2012, Summit Showa Aluminum projects year-to-year higher sales volume, better revenue and profit. Order volume is expected to increase. The firm also continues cost cut measures by productivity improvement at domestic 4 factories and review of breakeven points at each site. As for RSI (re-melted aluminium can scrap ingot), the profitability has recently worsened and then the firm decided to reduce the output volume in fiscal 2012 through negotiations with the users. The production will decrease to 700-800 tonnes per month from previous 1,100 tonnes. Summit Showa Aluminum’s president Yoshihiko Suzuki told the firm tries to reinforce its competitiveness even reviewing outsourcing orders or eyeing technical partnership with offshore companies.