Jan 25 2011
China Carbon Graphite Group, Inc. (OTCBB:CHGI) ("China Carbon" or the "Company"), the largest wholesale supplier of fine-grain and high-purity graphite in China, and one of the nation's top manufacturers of carbon and graphite products, today announced that it has completed the exterior construction of its new 30,000-ton plant, and will start installation and shakedown testing of a 4200-ton compressor and 36 annular kilns soon. The new facilities are expected to begin production by June 2011.
The new plant will focus on manufacturing ultra-high graphite electrodes with a diameter ranging from 600 to 800mm, fine grain, and high-purity graphite. The industrial application of these widely used products, which includes, aerospace, defense, automotive and clean tech end products, currently carries the greatest demand of all forms of graphite.
According to the Company, this new plant will have the largest and the most technologically advanced equipment in China capable of producing ultra-high electrodes with a diameter as large as 800 mm, and rounded fine grain electrodes with a diameter as large as 600 mm. The demand of these two types of graphite products is currently overwhelming. The expansion makes the Company China's first domestic producer of 800 mm diameter ultra-high electrodes and also further strengthens the Company's leading position in China's fine grain graphite market.
"Once new facilities are fully operational, our production capacity will be doubled from our current level," said Donghai Yu, China Carbon's CEO. "This new plant will focus on manufacturing higher margin products, including ultra high electrodes, and fine grain and high-purity graphite, with a gross profit margin of 30%, 35% and 21-29%, respectively. As a result, we fully expect to have higher profitability beginning in 2011 from a combination of increased production, higher margin sales and our ability of locking in raw material costs by using our $27 million loan."
"This expansion represents an important step for China Carbon that will solidify its status as one of the most significant manufacturers of graphite and related products in China."