Key Supplier for Capacitor Makers Closes Plant on Nuclear Leak

Shares of Japan’s capacitors makers may fall further after a key supplier was forced to abandon its factory near the damaged Fukushima Dai-Ichi nuclear plant.

Production of a chemical solution used in the production of aluminum-electrolytic capacitors has been halted at Tomiyama Pure Chemical Industries Ltd.’s plant north of Tokyo, according to the company’s general manager, after workers were evacuated following a 9.0 earthquake that struck the nation and crippled the nearby nuclear plant. The manager declined to give his name.

“The supply chain from chemicals makers to aluminum- electrolytic-capacitor makers is experiencing trouble overall,” said Chikai Tanaka, an analyst at Nomura Holdings Inc. “The capacitors are used in most electronics other than cell phones, so I expect some impact on industries including television and computers.”

Nippon Chemi-Con Corp. (6997) has tumbled 33 percent in Tokyo since the close of trade before the quake hit through today, while the Kyoto-based Nichicon Corp. (6996) slid 2.4 percent from the March 10 close.

Tomiyama Pure Chemical, which says on its website to be “Japan’s only manufacturer for the specialized electrolytes” used in making the capacitors said a plant in Saitama prefecture, further south, lacked capacity to make up for the shortfall in production. A spokesman at Nippon Chemi-Con’s corporate planning department, who declined to give his name, said Tomiyama Pure Chemical’s market share is high and if the supply disruption continues, it will hurt the industry.

“We still have some stock, so there is no impact on the company at the moment,” said Fumio Yamashita, a spokesman for Nichicon. “But looking forward, we are considering different options including finding a substitute for the chemical.”

To contact the reporter on this story: Toshiro Hasegawa in Hong Kong at thasegawa6@bloomberg.net.

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net.

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