Japanese specialty lubricant manufacturer Moresco Corp will set up a new company in China to consolidate its lubricant plants in Shanghai and Wuxi into a new plant in Zhejiang, eastern China, the company announced on Feb. 14.
“With the urbanization and commercialization of Shanghai and Wuxi, we are now looking to see if we can continue to use the [current] site for our plants,” a company spokesperson told Lube Report. “We have decided to set up a new company and in the future consolidate our plants into the new company.”
The new company’s provisional name is Moresco (Zhejiang) Functional Material Co., Moresco said in a Feb. 14 press release. The company will produce, import and export specialty lubricants and sealants, and will have a research and development team to develop lubricants and die casting lubricants. The new company located in Zhejiang, eastern China or south of Shanghai and Wuxi, is expected to be set up in March.
The company did not disclose the timeline for construction of the new plant. “We expect our plant to be completed within a few years’ time, but we also need time to coordinate with the local government and industrial zones on land acquisition and factory construction,” the spokesperson added.
Moresco has two plants in China – one in Shanghai and one in Wuxi – producing specialty lubricants such as die casting lubricants and metalworking fluids. It also operates plants in Thailand, India and Indonesia.
For the third fiscal quarter ended Nov. 31, sales of specialty lubricants increased 27.2% to ¥9.7 billion (U.S. $ 84.2 million) and synthetic oil grew 7% to ¥1.5 billion. Sales of lubricants and synthetic oils make up slightly more than half of the company’s total sales of ¥20.4 billion. The company said in its earnings report that sales of high temperature lubricant oils grew because of the “recovery in the domestic automotive production and demand from China.” The company produces sulfonates used as additives for metalworking fluids and engine oils. It also produces Nybrine, a heat transfer medium that is mainly composed of ethylene glycol and propylene glycol, used in the prevention of equipment corrosion, organic photovoltaics, flexible, film-shaped solar cells, hot melt adhesives and others.