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SDK Subsidiary Completes Rare Earth Metal Plant in Vietnam

Showa Denko K.K.
May 11, 2010

—Ensuring Stable Supply of High-Performance Magnetic Alloys—

Showa Denko Rare-Earth Vietnam Co., Ltd., a subsidiary of Showa Denko K.K. (SDK) established in October 2008, has completed a new rare earth metal plant in Vietnam. The plant will produce 800 tons a year in total of didymium and dysprosium metals, which are used as raw material for neodymium-based high-performance magnetic alloys. A ceremony was held today at the plant to celebrate the completion.

Didymium is a metal consisting primarily of neodymium and praseodymium. Addition of a small amount of dysprosium ensures high magnetic force of neodymium-based magnets at high temperatures.

In addition to current applications in electronics, such as hard disk drives, and automotive parts, neodymium-based high-performance magnets are expected to be increasingly used in such environment-friendly products as hybrid cars, electric vehicles, and energy-saving electric appliances as well as in wind power generation.

Rare earth raw materials, including neodymium and dysprosium, are now supplied mainly from China. To meet rapidly increasing demand on a global scale, it is necessary to establish a system for stable supply of rare earth raw materials and their recycling.

In its rare earth metal production, Showa Denko Rare-Earth Vietnam will process raw materials and recycle magnets purchased from various sources inside and outside Vietnam. The plant will use SDK’s proprietary processing technologies, while adopting efficient effluent treatment and other environmental protection measures. The metals thus produced will be used at SDK’s rare earth magnetic alloy plants.

SDK is currently producing rare earth magnetic alloys at its plant in Chichibu, Japan, and at two subsidiaries in China (Baotou, Inner Mongolia; and Ganzhou, Jiangxi Province). Total production capacity amounts to 8,000 tons a year. With the completion of the new metal-producing plant in Vietnam, SDK will further strengthen its rare earth magnetic alloys business.

The new rare earth plant in Vietnam

[Reference]

Profile of Showa Denko Rare-Earth Vietnam Co., Ltd.

Location Dong Van 2 Industrial Zone, Ha Nam Province, Socialist Republic of Vietnam
(Approx. 40 km south of Hanoi; along the national highway No. 1)
Capital US$6.36 million (approx. ¥700 million)
Establishment October 1, 2008
Shareholders Showa Denko K.K. (90%); Tokai Trade Co., Ltd. (10%)
Scope of business Production and sale of didymium metal, dysprosium metal, and other rare earth products
Employees Approx. 130
President Daiken Murakami

Outline of Showa Denko's rare earth operations

Rare earth magnetic alloy production sites and annual production capacity
Chichibu Plant, Showa Denko K.K. (Japan): 5,000 tons
Baotou Showa Rare Earth Hi-tech New Material Co., Ltd. (China): 1,000 tons
Ganzhou Zhaori Rare Earth New Material Co., Ltd. (China): 2,000 tons
Total capacity: 8,000 tons a year

Rare earth metal production site and annual production capacity
Showa Denko Rare-Earth Vietnam Co., Ltd. (Vietnam): 800 tons

For further information, contact:
IR & PR Office (Phone: 81-3-5470-3235)