China Power Gap Hits Aluminum Maker

SHANGHAI, China (AP) - Aluminum Corp. of China said Thursday it has stopped production at two factories, another sign a worsening power shortage in the country is beginning to affect regional industries.

China's largest aluminum maker, also known as Chalco, said it suspended output at its Guizhou aluminum plant and at Zunyi Aluminum Corp., both in southwestern Guizhou province, beginning Wednesday.

"Natural disasters and a shortage of thermal coal in Guizhou province have led to limited power supply since December at the two plants," Chalco said in a statement. It did not say how much the shutdown would affect the company's overall production.

Production at some steel mills and machinery plants has also been affected by power shortages and rationing, according to reports in the state-run media.

China's chronic wintertime shortages of coal, used to fuel three-quarters of its electricity generation, have been aggravated by disruptions to transport networks due to unusually heavy snow. In some areas, snow has also damaged power grids.

The problem reportedly has been compounded by friction over prices for coal and electricity. Coal suppliers are pushing for higher prices, while utilities have chafed at controls about electricity rates that prevent them from passing higher costs for coal to customers.

Chalco's shares fell 4.5 percent to 10.96 Hong Kong dollars in that country and by 2.5 percent to 32.62 yuan in Shanghai.

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