From Reuters, September 1:
Two more European aluminum smelters are powering down as the region’s energy crisis shows no signs of abating.
Slovenia’s Talum will reduce output to just a fifth of capacity and Alcoa will curtail one line at its Lista plant in Norway.
Close to 1 million tonnes of European primary aluminum capacity is now offline and more may follow as a notoriously power-hungry sector struggles to cope with soaring energy costs.
The aluminum market, however, is unimpressed by Europe’s mounting production woes, the London Metal Exchange (LME) three-month price sank to a 16-month low of $2,295 per tonne on Thursday morning.
A weak global reference price reflects rising Chinese production and growing demand fears for both China and the rest of the world.
But European and US buyers will get only partial relief because physical premiums remain historically high as regional disparities rupture the “all-in” price for their metal.
Power switch
Aluminum production outside China fell by 1% in the first seven months of this year, according to the International Aluminium Institute (IAI).Rising output in South America and the Gulf region couldn’t fully offset the accumulating power hits to smelters in Europe and the United States.
Western European production slumped by 11.3% year on year in January to July and annualized run rates are now consistently below the 3 million tonne mark for the first time this century.
North American output dropped 5.1% over the same timeframe and July’s annualized production of 3.6 million tonnes was also the lowest this century.
The sharp slide reflects the full shuttering of Century Aluminum’s Hawesville plant and the partial curtailment of Alcoa’s Warrick plant....
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