Showa Denko K.K. (SDK) to Up Production of Large-Diameter Graphite Electrodes.

Tokyo, Japan, Apr 6, 2006 - (JCN Newswire) - Showa Denko  K.K. (SDK) has decided to increase its production of 30-inch- and 32-inch-diameter graphite electrodes from around 15,000 tons/year at present, to 25,000 tons/year by 2010, to meet growing demand from electric arc furnace (EAF) steelmakers. SDK will install a new line of graphitizing furnace at its Omachi Plant, Japan, and have its U.S. subsidiary Showa Denko Carbon, Inc. produce larger-diameter electrodes.

EAF steelmakers around the world are introducing larger furnaces to increase productivity, resulting in greater demand for large-diameter graphite electrodes. There has been a shift from 28-inch-diamter electrodes to 30-inch-diameter electrodes since 2004, especially in the United States, Europe, Japan, South Korea and Malaysia. SDK last year began commercial production of the world's largest 32-inch-diameter electrodes. SDK expects that demand for graphite electrodes with diameters of 30 inches or larger will increase substantially in the coming years.

The graphite electrodes are produced by forming, baking, and graphitizing raw material coke. Production of large-diameter graphite electrodes requires that the material should be heated uniformly throughout the baking and graphitizing processes. With a strict quality control system and high process technology, SDK has already secured the leading share of around 40% of the world's large-diameter graphite electrode market. Following the planned expansion, SDK will aim to raise the market share further, to around 50%. SDK will start constructing the new graphitizing furnace by the middle of this year, investing approximately \1 billion. The new graphitizing furnace will become operational in the second half of 2007.

Under the new medium-term consolidated business plan, the Passion Project, which started this year, SDK will accelerate its growth strategy while strengthening the competitiveness of base businesses. As part of the plan, SDK will strengthen the competitiveness of the graphite electrode business by substantially cutting costs and shifting to the production of high-value, large-diameter electrodes.

About Showa Denko K.K.

Showa Denko (SDK)(TSE: 4004)(OTC: SHWDF) is a major manufacturer and marketer of chemical products serving a wide range of fields ranging from heavy industry to the electronic and computer industries. SDK makes petrochemicals (ethylene, propylene), aluminum products (ingots, rods) electronic equipment (hard disks for computers), and inorganic materials (ceramics, carbons). The company has overseas operations and a joint venture with Netherlands-based Montell and Nippon Petrochemicals to make and market polypropylenes. In March 2001, SDK merged with Showa Denko Aluminum Corporation to strengthen the high-value-added fabricated aluminum products operations, and is today developing next-generation optical communications-use wafers.

Source: Showa Denko K.K.

Contact:

Showa Denko K.K.
Nobuhiro Kato
[e-mail]
[phone]

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