- Profits impacted by competitive prices of Chinese products
- Closed facilities account for 1/3 of Resonac’s global output
Japan’s Resonac Holdings has formally announced its decision to discontinue graphite electrode manufacturing operations in China and Malaysia, as per news reports.
This measure is part of a broader strategic response to declining profit margins, attributed to increased competition from low-priced Chinese products. Consequently, the company will proceed with the liquidation of its subsidiaries in both countries.
Market share
Resonac, a major global graphite electrode producer, has an annual capacity of 210,000 tonnes (t) across six plants. With these closures, only four plants – in Japan, the US, Austria, and Spain – will remain operational. While individual production figures were not revealed, the closed Asian facilities reportedly accounted for roughly one-third of Resonac’s global graphite electrode output.
Ongoing network review
Chief Financial Officer Hideki Somemiya stated during an earnings briefing that the company would continue reviewing its global production network to enhance operational efficiency and profitability. The closure signals a major shift in Resonac’s manufacturing strategy, focusing on higher-yield markets.
Mounting losses in chemical segment
The company’s chemicals division, which includes the graphite electrode business, reported a core operating loss of JPY 6.3 billion ($43.3 million) for the January-March 2025 quarter. This marks a sharp increase from the JPY 800 million loss in the same quarter in the previous year.
More reforms planned by August
To achieve profitability in the second half of fiscal 2025, Resonac is planning a second and possibly more rounds of structural reforms. Somemiya noted that further announcements will be made around August, indicating that the company’s global restructuring efforts are far from over.
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