Global aluminum output flatlines as outages offset ramp-ups ¨C Mr Andy Home

Mr Andy Home a columnist for Reuters expressed his opinion that global aluminum production flatlined in the first quarter of this year, according to the International Aluminium Institute. A couple of long-running outages together with curtailments in Europe caused production outside China to dip 1.4% to 6.37 million tonnes in the first three months of 2019.

Chinese production, a complex moving picture of price-induced curtailments, pollution controls and capacity swaps, edged 1.6% higher to 8.93 million tonnes. The net result was that global production rose by a marginal 0.3% YoY as China remained the world’s dominant player with a 57% share of world production.

Continued smelter outages and fresh capacity curtailments are keeping a lid on Western production even as new and old smelters ramp up.

Production in Latin America, for example, slumped 22% to 253,000 tonnes in the first quarter of this year.

That’s down to the continued partial closure of the Brazilian Albras smelter, which has been running at 50 percent capacity since April 2018.

Norway’s Hydro reduced capacity to align output with feed availability from the Alunorte alumina refinery, which was ordered to cut production by half after an alleged tailings spill.

The 225,000 tonnes-per-year smelter hit has had an oversized impact on regional production because so few Brazilian smelters have survived years of collective blood-letting.

Hydro and the Brazilian authorities appear to be inching toward an agreement on a full reopening of Alunorte, which should in turn feed through to higher operating rates at Albras.

Less certain is whether the Aviles and La Coruna smelters in Spain will return to production.

Alcoa, which has targeted both plants for closure for some time, finally reached agreement with unions in January and curtailed the last operating potlines in February, removing 128,000 tonnes of annual capacity from the European market.

Western European production slid almost 4 percent to 877,000 tonnes in the first quarter of this year.

As part of the deal with Spanish authorities, Alcoa has committed to keeping the two smelters in “restart condition” in the event a buyer emerges. But only until the end of June, with the clock now ticking.

Alcoa’s Becancour smelter in Canada has been running at minimal capacity since a union lock-out in January 2018.

Production slumped from 438,000 tonnes in 2017 to 136,000 tonnes in 2018, minority owner Rio Tinto says.

Alcoa curtailed another 69,000 tonnes of capacity at the end of last year, reducing operations at Becancour to half a potline.

A peace settlement still appears a long way off after the United Steelworkers accused Alcoa of rejecting its latest offer on a negotiated settlement.

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