Alcoa cuts last smelting capacity at São Luís facility in Brazil
TORONTO (miningweekly.com) – Aluminium and lightweight metals producer Alcoa will curtail the remaining 74 000 metric tons of smelting capacity at its São Luís facility, in Brazil.
NYSE-listed Alcoa on Monday said the curtailment was part of its plans to evaluate upstream capacity for possible curtailment, closure or sale as it optimised its commodity portfolio.
The curtailment was expected to be completed by April 15.
“We continue to take decisive steps to create a globally competitive commodity business and are executing against our upstream capacity review. These are difficult but necessary actions in support of Alcoa’s strategy to lower the cost base of our upstream businesses,” global primary products president Bob Wilt said.
Alcoa had already curtailed 85 000 t of capacity at São Luís in May last year, followed by the curtailment of a further 12 000 t of capacity in October. The company cited challenging global market conditions in primary aluminium production and increased costs having made the smelter uncompetitive. The refinery at São Luís would remain unaffected and continue normal operations.
Alcoa earlier this month announced that it would evaluate 500 000 t of smelting capacity and 2.8-million tons of refining capacity for possible curtailment, closure or sale. Once all smelting at São Luís came to an end, Alcoa would have about 740 000 t, or 21%, of its smelting capacity offline.
The company expected to record a restructuring-related charge in the current quarter of between $10-million and $15-million, or $0.01 a share, after-tax.
The company aimed to lower its position on the world alumina cost curve to the twenty-first percentile and on the aluminium production cost curve to the thirty-eighth percentile, by 2016.
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