Stable supply of quantity and price through general agency contract

IssuesBackground/Issues

Initiative details

Why usWhy Japan Sea

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Aluminum hydroxide (aluminum hydroxide) is produced from bauxite and is used as alumina by sintering, as well as as an intermediate raw material for various chemical products. The total demand in Japan is estimated to be approximately 700,000 tons, and there is a large demand for it as a water treatment material, and it is used in various factories. From 2024 onwards, the international market for water-aluminum has been rising due to export restrictions in Guinea and Indonesia, which are major exporters of the raw material bauxite, and as Japan’s domestic demand is mainly dependent on imports, each company is facing a shortage of supply.

In order to meet the demand for aluminum hydroxide (aluminium hydroxide) in Japan, Nippon Kai Ka has concluded a general agency agreement with Nanshan Group, a major aluminum manufacturer in China, in February 2024. As a result, we have been able to secure quantities even in highly volatile market conditions around the world, and have achieved stable supply to our domestic customers. As a result, sales volume in fiscal 2024 increased by approximately 10% compared to the previous year.

Aluminum hydroxide (aluminium hydroxide) is susceptible to policy changes in China, and is subject to futures trading, making it a product whose market conditions are particularly volatile among chemical products. Since Nihonkai Chemical imports a variety of chemical products from China, we are able to quickly grasp changes in market conditions in China, predict future demand based on market trends in Japan, and secure inventory appropriately through quick decision-making.
Furthermore, through our exclusive agency agreement with Nanshan Group, we are not only able to provide stable supply in terms of both quantity and price, but also use foreign exchange contracts to reduce the risk of foreign exchange fluctuations, further stabilizing supply.