Chuo Denki Kogyo Seeks Growth by Functional Materials

Chuo Denki Kogyo tries to growth through expansion of functional materials business. The functional materials unit posted higher sales, operating profit and asset than the former main business of ferroalloy in fiscal 2011 ended in March 2012. The firm expects the trend continues in fiscal 2012. The functional materials business would lead the growth when the subsidiary, Chuden Rare Earth increases from raw materials to materials for motor and secondary battery as key technology for next generation vehicle.

The president Ryo Someya said the firm expanded the functional materials business as second core unit after ferroalloy. The functional materials unit posted 3 billion yen of operating profit with 29.2 billion yen of sales in fiscal 2011 compared with ferroalloy unit’s 200 million yen of operating profit with 24.4 billion yen of sales. The firm expects more than 30 billion yen of sales for functional materials and 25 billion yen sales for ferroalloy unit in fiscal 2012.

The firm expects production of hydrogen storage alloys reaches annual 4,800 tonnes of the capacity from current 4,200 tonnes. The firm eyes doubling output capacity of manganese sulfate to monthly 600 tonnes to meet growing demand as positive electrodes in lithium ion cells. The firm also eyes more than double expansion of graphite from current annual 2,000 tonnes to meet growing demand as negative pole material of lithium ion battery.

The firm started primary light rare earth production at the Vietnamese plant establishing first phase of the project with 1,000 tonnes of annual output capacity including heavy rare earth recycling. The first phase allows 30% own source for heavy rare earth for magnet alloy and 50% own source for light rare earth for hydrogen storage alloys for stable supply of the raw materials. The firm eyes second phase for the plant in future.