Refwin: It is a great pleasure for Refwin to interview you again! As 2024 comes to an end, how would you summarize Shinagawa's achievements during this year full of more challenges than 2023?
Mr. Heiki Miki: It is truly an honor to be part of your interview series again. Reflecting on the business environment, 2024 was undoubtedly a challenging year. It marked one of the toughest periods, with ongoing market downturns and geopolitical uncertainties. However, I see this as a blessing in disguise. The obstacles we faced in our existing businesses forced us to rethink our approach, pushing us out of our comfort zone and inspiring entirely new initiatives and strategies.
Shinagawa has long been a key player in Japan's refractory supply industry, particularly within the iron and steel sector. However, with the dual challenges of declining demand and a shrinking market, we made a bold decision several years ago to venture beyond our traditional boundaries. We expanded our focus from Japan to a global presence, shifted from refractories to encompass insulation, ceramics, and engineering, and diversified from iron and steel into new market segments.
2024 was a pivotal year in solidifying this strategy and laying the groundwork for our future growth. Despite the global challenges, we took significant steps to ensure sustainable growth in the years ahead. Key initiative we launched across all our global locations was “One SHINAGAWA.” This initiative is designed to ensure seamless collaborations among our operations worldwide, enabling us to serve our customers with greater efficiency and effectiveness.
Refwin: You established PT. Shinagawa Refratech Perkasa in April. What promoted Shinagawa to set up a joint venture in Indonesia? How does the Southeast Asian market fit into Shinagawa's global strategy?
Mr. Heiki Miki: As a key player in Japan and driven by our PROXIMITY strategies, establishing a strong presence in the Southeast Asian market has been a priority for Shinagawa. This year, we took a significant step forward by establishing PT. Shinagawa Refratech Perkasa (“SRP”) in Indonesia. We view Indonesia as the most important market for Shinagawa in Southeast Asia, given its growth potential, burgeoning population, and abundant natural resources.
SRP is a joint venture with PT. Refratech Mandala Perkasa (“RMP”), a respected local refractory manufacturer. Partnering with a reliable local business is essential to effectively serve customers in the region, and we’re grateful to have established SRP as a joint venture with RMP. However, our focus extends beyond Indonesia. By leveraging SRP as a strategic base, we are expanding our operations across Southeast Asia. We already have two locations in Malaysia—Isolite Insulating Firebrick (IIF) and Isolite Ceramic Fibers (IIF). The synergy of our One SHINAGAWA activities in both Indonesia and Malaysia enables us to penetrate the Southeast Asian market effectively, offering a comprehensive range of refractory and insulation products.
Refwin: Then, you welcomed Netherlands-based Gouda Refractories Group to Shinagawa Group in October. How does the acquisition mean for Shinagawa? What is Shinagawa's marketing strategy in Europe?
Mr. Heiki Miki: Welcoming Gouda Refractories Group ("Gouda") into our fold has been a truly transformative event. Prior to this, Shinagawa had limited market presence in Europe, primarily serving a small customer base through refractories exported from Japan and operating a sales office for Isolite Insulating Products in Germany. With Gouda’s production facilities in the Netherlands and service sites across the Netherlands, Belgium, Germany, and Sweden, Shinagawa now has ideal access to both Europe and the Middle East—regions where our market presence had been quite limited.
This acquisition presents a golden opportunity to expand our reach, leveraging Gouda’s service network to introduce our high-quality refractory and insulation products to new customers in these regions. Moreover, Gouda’s product offerings and service capabilities in the petrochemical, energy, and non-ferrous metals industries perfectly complement and enhance Shinagawa’s existing product portfolio and customer base. In particular, Gouda is one of the few manufacturers holding all major certifications required by global petrochemical producers and technology providers, positioning us strongly to establish a competitive presence in this valuable sector.
Within the petrochemical and energy industries, Gouda plays a key role in supplying refractories that support energy transition and sustainability goals. Their products serve the waste-to-energy market and include technologies that enhance efficiency and reduce emissions in petrochemical and oil refining operations. When combined with Shinagawa’s strengths, Gouda will be better positioned to expand its services network in North-West Europe, as well as extend its refractory offerings to customers in the Middle East, South-East Asia, and the Americas.
Together, we will be able to offer enhanced support to local customers, ensuring a stable supply of high-grade refractory materials essential for their critical production equipment and installations.
Refwin: In addition, Shinagawa has established a new company in Shandong, following the announcement of a new flow control refractories manufacturing plant in Liaoning, China. What factors influenced Shinagawa’s decision to make such significant investments in China?
Mr. Heiki Miki: In recent years, we’ve been reassessing our growth strategies and have made the decision to expand our presence in China. While the growth rate of industries in China is slowing, we recognize a growing demand for high-quality refractories. These products are essential for helping our customers increase productivity and produce superior products—an area where we see significant opportunities.
In April, we announced the establishment of a new manufacturing plant for alumina-graphite flow control refractories for continuous casting in steelmaking, located in Liaoning, China. This project marks another key milestone in Shinagawa’s strategy of “PROXIMITY,” emphasizing customer-centric refractory solutions and services for essential industries.
Shinagawa and Anshan Hefeng Refractory Material ("Hefeng"), one of China’s most reputable refractory producers, formed a joint venture in 2008 to locally produce mold powder for continuous casting. Over the years, Shinagawa Hefeng has grown its business, gaining recognition from major steel producers in China, South Korea, and other Southeast Asian countries.
Building on 16 years of successful partnership, Shinagawa and Hefeng have decided to pursue further growth by expanding Shinagawa Hefeng’s operations with a new flow control refractory production facility. This aligns with the shift from quantity-driven to quality-driven steel production in China and across Asia, where there is an increasing need for high-quality refractory solutions, such as continuous casting submerged entry nozzles. Both mold powders and flow control nozzles are critical components in the continuous casting process, and Shinagawa is committed to leveraging technological synergies through Shinagawa Hefeng to meet these evolving needs.
To further support our business strategy in China and promote deeper collaboration within our group, we’ve also announced the establishment of “Shandong Shinagawa Refractories Corporation.” This initiative aligns with our long-term vision, “Vision 2030,” and our 6th Medium-term Management Plan (2024-2026), which emphasizes strengthening our global expansion efforts.
Refwin: Could you provide more insights into your 'One SHINAGAWA' initiative? We've noticed many of your public posts featuring Shinagawa employees from various roles/countries displaying the 'Number 1' hand sign.
Mr. Heiki Miki: Although we are still on our journey, Shinagawa’s globalization is undoubtedly progressing. What is critical now is ensuring seamless and close communication across all business units. As our customers become more globalized, it is essential that we respond as a unified organization. To reinforce this, we introduced the slogan "One SHINAGAWA." This initiative, however, extends beyond our overseas operations. It also aims to strengthen communication within Japan, connecting various departments such as factories, sales, manufacturing, research, planning, and procurement.
In November of last year, we held a review of our 2025 plan in Tokyo, bringing together executives from our business hubs in Japan, China, the U.S., Brazil, Australia, Indonesia, and the Netherlands. This marked the beginning of a truly global forum for Shinagawa. To meet the needs of our global customers and establish ourselves as a true global player, accelerating the "One SHINAGAWA" initiative is key. In 2025, we will continue to build on these efforts, further strengthening our global unity.
Refwin: Of the various challenges you're facing in the current market, which one is the most critical, and how are you addressing it?
Mr. Heiki Miki: Uncertainty. ‘Uncertainty is the biggest threat to business success,’ and I couldn’t agree more. The uncertainty surrounding our business continues to grow by the day, by the hour, and we must face it, whether we like it or not. Uncertainty breeds unpredictability, making it difficult to plan and execute long-term strategies. Whether it’s fluctuations in the economy, changing regulations, geopolitical tensions, or shifting consumer behaviors, the lack of clarity about the future undermines confidence in decision-making and resource allocation. It can disrupt production schedules, impact investments, and even prevent businesses from seizing new opportunities at the right time.
To navigate this uncertainty, flexibility has become our greatest strength. We’ve embraced an agile approach, ensuring that our strategies are not only robust but adaptable to rapid changes. By being flexible, we can quickly adjust our operations, explore new markets, and refine our product offerings to meet shifting demands. Flexibility enables us to respond to crises with speed, innovate under pressure, and even thrive in volatile conditions. In today’s business environment, the ability to pivot quickly and maintain a proactive mindset is crucial to staying competitive and ensuring long-term success.
Refwin: What is Shinagawa's practice in recycling used refractories? How to improve the recycling rate of used refractories while ensuring the performance?
Mr. Heiki Miki: Recycling used refractories for raw materials is no longer just an option—it's an essential initiative, and Shinagawa is proud to lead the way in this critical movement within the global industry.
Approximately 70% of the total lifecycle CO2 emissions of refractory products come from the manufacturing of refractory raw materials. Green refractories, which incorporate 20% or more recycled used refractories or by-products from other industries, result in CO2 emissions that are close to zero. By adopting Green Refractories, we can significantly reduce CO2 emissions across the entire refractory lifecycle (Scope 1, 2, and 3). Of course, ensuring that the performance remains consistent despite the increasing use of recycled raw materials is a top priority.
Through the recycling of used refractories, we not only contribute to reducing CO2 emissions from raw material production and conserving mineral resources, but we also help our customers achieve zero emissions and reduce their environmental impact. Additionally, these alternative raw materials are reliably sourced, further enhancing the stability of our raw material procurement.
In April 2023, Shinagawa began processing used refractories at JFE Steel’s West Japan Works in the Kurashiki area. Alongside the construction and demolition of refractories, we have initiated the processing of used refractories. With effective management, we’ve established a system that drives continuous improvements, including expanded recycling capabilities and enhanced operational efficiency.
In April 2024, we took another important step by establishing the Recycling Business Promotion Department. Although we have been involved in recycling initiatives since 2022, this new department was created to better manage our efforts and achieve key objectives, including supporting the Development, Manufacturing, Sales, and Procurement departments and overseeing planning, research, and investment activities.
At Shinagawa, we are committed to driving forward the sustainable use of resources and reducing our environmental footprint, reinforcing our leadership in the refractories industry.
Refwin: 2025 marks the 150th anniversary of Shinagawa. What key factors behind its past success can the company carry forward to ensure continued growth and achievement over the next 150 years?
Mr. Heiki Miki: As we step into the Year of the Snake (巳年), a symbol of renewal, prosperity, and forward-thinking approaches to new challenges and transformations, we embrace these qualities with enthusiasm. In 2025, as we celebrate our 150th anniversary, Shinagawa reaffirms its commitment to embracing challenges, pursuing growth, and continuously improving—all while contributing to the global community. "No Refractories, No Life."
Over the past 150 years, Shinagawa has cultivated a strong corporate culture built on integrity, trust, and commitment to excellence. This foundation has been instrumental in attracting and retaining top talent, as well as fostering employee loyalty and satisfaction. By continuing to invest in our people, encouraging innovation, and promoting values-driven leadership, Shinagawa is poised to remain a respected global leader in the refractories industry.
Central to our success is the “PROXIMITY” strategy, which emphasizes customer-oriented solutions. By focusing on understanding our clients' needs, offering tailored products, and building lasting relationships, we have established a reputation for excellence. Maintaining this customer-first mindset will be crucial as we continue to adapt to shifting market demands and expand into new regions.
Shinagawa’s ability to adapt to global market shifts—such as the evolving needs in steelmaking—has been another key to our success. As industries continue to evolve, driven by technological advancements and changing consumer demands, we must remain agile and ready to respond to new opportunities and challenges.
The shift from quantity-driven to quality-driven production in industries like steel reflects a growing awareness of sustainability. Shinagawa’s dedication to producing high-quality, efficient refractories that help reduce energy consumption and improve production processes aligns with the global movement toward sustainability. Focusing on eco-friendly, energy-efficient solutions will enable Shinagawa to thrive in an increasingly sustainability-conscious market.
By building on these strengths and continuing to innovate, Shinagawa is well-positioned to navigate the challenges of the next 150 years, continuing our legacy of excellence and leadership in the refractories industry.
AD
