Ormet to cut output at Burnside alumina refinery
SINGAPORE, Sept 12 |
SINGAPORE, Sept 12 (Reuters) - U.S. aluminum producer Ormet Corp said it was cutting back operations at its Burnside alumina refinery in Louisiana, due to high power costs and low global prices that have also forced it to shutter part of its aluminium production.
A small producer on the global scale, Ormet joins industry heavyweights Rusal, Alcoa and Norsk Hydro to cut output as a growing production base in China's north west, fuelled by power subsidies, forces the closure of higher cost operations in the West.
"The dramatic increase of the cost of electricity in Ohio over the past several years, in addition to the current aluminum market, have forced Ormet to significantly downsize its operations while exploring strategic alternatives," the company said in a statement late on Tuesday.
Ormet has warned its 250 Burnside employees they may face job losses. The plant has production capacity of around 540,000 metric tons of alumina a year. Alumina is a key ingredient for making aluminium. In late August, Ormet said it was paring operations at its Hannibal smelter, which has an annual capacity of 271,000 metric tons of aluminium, to four potlines.
As recently as March, Ormet reopened its Burnside alumina refinery which was closed for five years due to low alumina prices.
In May, it formed a joint venture with Trafigura to buy bauxite, alumina and aluminum projects as the Swiss trading house looked to bulk up its aluminium business.
Aluminium prices hit three-year lows below $1,830 last month, but have since rebounded 13 percent on expectations of monetary easing around the world.
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