RUSAL can idle 200 thousand tons of capacity

The world leader in aluminum production, United Company RUSAL, is reviewing its aluminum smelting operations and may idle another 200,000 tonnes of capacity. RUSAL, which has cut capacity by 800 thousand tons over the past two years, reported that its aluminum production in Q1 2015 was 900 thousand tons, which is 2 percent lower than the previous quarter, but 2 percent higher than a year ago. ...

The company expects production to remain at the level of the previous year throughout 2015. Oleg Mukhamedshin, Deputy CEO of RUSAL, said that the company is considering the prospects for developing production in a low-price environment and plans to switch production to the use of environmentally friendly energy sources. The company is looking for an opportunity to manufacture almost all of its products using electricity from hydroelectric power plants.

Recent market outlooks show weak global aluminum prices and a two-fold decline in premiums this year in parts of Asia as China ramps up its exports of semi-finished products and the London Metal Exchange is responding accordingly. Under these conditions, RUSAL announced that it would not restart its production facilities, which had been suspended since 2013. The shutdown of production capacity in the past two years has come at the expense of factories that have used electricity from coal-fired power plants and other fossil fuels.