HOTTER ON METALS: Alcoa calls for industry-wide aluminium cuts

Alcoa Corp has called on the aluminium industry to assess the cost effectiveness of its smelting capacity and make cuts where appropriate - or face a ratcheting up of inventories and a protracted period of low prices.

Roy Harvey, the US producer’s chief executive officer, said that while curtailments were costly, both financially and in terms of job losses, they were more than necessary at this moment in time.
“This industry is right now producing more aluminium than it needs, which means that it extends out the difficult pricing environment, because you’ll have that new source of supply of inventory metal that comes in later,” he said. 
“I think it needs to be a clear call for action, that really demands people think about the competitiveness of their smelters and ensures that we are smartly acting as an industry through this cycle,” he added. 
He’s right. Sadly, as history has shown, aluminium producers tend to take a last-man-standing approach to idling capacity, particularly in China, where production just continues to grow.

The pace of China’s aluminium smelting production growth has been...

Published

Andrea Hotter

May 15, 2020

15:10 GMT

New York