Alcoa announced that it intends to close or curtail approximately 531,000 metric tons, or 12% of its global smelting capacity, to lower the company’s position on the global aluminum cost curve and improve its competitiveness. Alcoa will permanently close its smelter in Alcoa, Tenn., which was curtailed in 2009, along with two of the six idled potlines at its Rockdale, Texas, smelter. Together, these closures will reduce Alcoa’s global smelting capacity of 4.5 million metric tons per year by 291,000 metric tons, or about 7%. The curtailments, to be announced in the near future, will reduce Alcoa’s global smelting capacity by an additional 240,000 metric tons.
Aluminum prices have fallen more than 27% from their peak in
2011. In addition to the curtailments, Alcoa will accelerate actions to reduce
the escalating cost of raw materials. The curtailments are expected to be
complete by the first half of 2012. Alcoa’s alumina production will be reduced
across the global refining system to reflect the final curtailments in smelting
as well as prevailing market conditions.