Japans specialty lubricant manufacturer Moresco Corp. will begin operations at its new lubricant plant in India in June in an effort to expand its overseas market share amid a slowdown in the global economy.
With the influence of the trade war between China and the U.S., the outlook for the world economy continues to be uncertain. Although the production of automotives in Japan remained firm, the slowdown in the Chinese economy is affecting company growth, Moresco said in its financial statement for 2018.
The 1 billion Japanese yen (U.S. $9 million) plant – located in Ahmedabad city, western India – has the capacity to produce 10,000 tons per year of lubricants and hot melt adhesives. The plant will primarily make lubricants for hot forging and metal cutting fluids.
For fiscal year 2020, the companys target is for total sales of specialty lubricants to increase 18 percent to 15,600 million yen and synthetic lubricants to reach 2,500 million yen.
According to the companys financial results for 2018, total sales for specialty lubricants increased 4.6 percent to 13,158 million yen, but synthetic lubricants dropped 5.1 percent to 2,602 million yen.
Sales of specialty lubricants increased in China, due mainly to new customer sales in metal cutting fluids and high-vacuum pump oil. However, a reduction in automotive production volumes resulted in a drop in revenues from die casting mold releasing lubricant and high-temperature lubricating oils and greases.
In Southeast Asia, production volumes of automotive lubricants remained firm and sales volumes for metal cutting fluids, die casting mold releasing lubricants and hydraulic fluids increased.
Domestic demand for specialty lubricants remained firm. In Japan, despite a fall in exports of automotive parts to China in the fourth quarter, sales of metal cutting fluid to existing customers and new customers in Japan increased.
In North America, sales of the companys die casting mold releasing lubricants remained unchanged, but there was a drop in hot forging lubricants due to an increase in recycling. Sales fell 5.7 percent to 794 million yen.
Sales of synthetic lubricants fell. High-temperature lubricating oils increased 6 percent, but hard disk surface lubricant fell 14 percent.