AluNews - March 2011

Jamaican alumina producer shuts down permanently
Caribbean Net News - 31-Mar-2010
KINGSTON, Jamaica (Reuters) -- The West Indies Alumina Co., whose majority shareholder is UC Rusal, laid off its remaining workers on Wednesday and said it would close its two refineries in Jamaica, labour leaders said.
The Jamaican company, known as Windalco, has a production capacity of 1.2 million tonnes of alumina annually. It halted bauxite mining and suspended operations at its Kirkvine and Ewarton refineries a year ago due to a worldwide downturn in demand for aluminum.
Windalco said at the time that the suspension would last at least a year, and cut its workforce of 1,119 to 762, keeping the latter group on the payroll with reduced hours and wages.
Windalco began laying off those workers on Wednesday and said it would cease operations after the sector failed to rebound from the effects of the global recession and falling world alumina prices.
"The company will terminate its employees at all levels," trade union leader Vincent Morrison said. "I am concerned about what will happen to the bauxite and alumina sector from this point onward."
Jamaica's government did not immediately respond to the decision, which dealt another severe blow to the Caribbean island's mining industry.
With the closure of Windalco, Jamaica has only two companies operating in the bauxite and alumina sector. Aluminum is made from alumina, which is produced from bauxite ore.
Jamalco, owned by Alcoa Inc and the Jamaican government, is still producing both bauxite and alumina.
Noranda Bauxite, previously known as St. Ann Bauxite, exports crude bauxite only. It is owned by privately held Noranda Aluminum Holding Corp and the Jamaican government.
The island's one-time largest alumina producer, Alumina Partners of Jamaica, closed a year ago and laid off more than 1,000 workers. That company, known as Alpart, was jointly owned by UC Rusal and Norsk Hydro.

RPT-INTERVIEW-Rain Commodities plans two waste heat plants in US
Reuters India - 31-Mar-2010
MUMBAI, (Reuters) - Rain Commodities Ltd (RACL.BO: Quote, Profile, Research) is planning to set up two waste heat recovery plants in the U.S. at an investment of $100 million and is in the process of tying up funds for the venture, a top official said on Wednesday.
The Hyderabad-based company, with a net debt of around $530 million, plans to raise around $100 million by selling tax-free bonds in the U.S, but is yet to finalise a date for issuance of the bonds.
"We are working on it and would know the timing of the bonds, may be in another six months from now," Vice President (Finance) T Srinivasa Rao told Reuters in an interview.
The plants will generate electricity of around 70 mega watts and are recognised as green projects, he said.
Waste heat recovery is a process by which heat generated during production of raw materials like calcined petroleum coke (CPC), used by aluminium industry, is converted into energy. Rain Commodities and its units - Rain CII Carbon (India) Ltd and Rain CII Carbon LLC, USA - are into production of cement, CPC and power. The company has a total capacity of 3.16 million tonnes per annum (MTPA) of cement and 2.49 MTPA of CPC.
The plants would be set up in Illinois and Louisiana, with construction expected to begin in the first quarter of calendar 2011. The plants would be completed by 2013, he said.
PRICE HIKE
Rain Commodities, which sells cement under the brand Priya Cement', may raise prices in line with other players, Rao said.
"...because there is an increase in input costs (like diesel prices), and to absorb that incremental cost, we need to hike (prices)," he said, but did not divulge details.
The company sells cement in the south Indian states of Andhra Pradesh, Tamil Nadu and Karnataka, and has no plans to foray into north and western states, he said.
Last week, the company's board had approved hiving off its cement operations to a wholly-owned subsidiary and setting up a global holding company in the U.S. for CPC business.]
The company expects to complete its restructuring by December this year, after which it will look to induct a joint venture partner, he said, adding it might consider acquiring another cement firm, depending on market conditions.
"Currently we are at 3.16 million tonnes (cement production), we want to make it something like 8 million or 10 million tonnes," after the restructuring and induction of strategic partner, he said.
Shares of the company closed up 1.14 percent at 208.05 rupees each in a weak Mumbai market. ($1 = 45 rupees)
(editing by Sunil Nair)

ABB wins aluminum project in Canada
ARC Advisory Group (press release) - 31-Mar-2010
Power and automation to improve overall productivity and energy efficiency
Houston, TX, March 30, 2010 --- ABB, the leading power and automation technology group, has won an order from Aluminerie Alouette to deliver power and automation solutions and engineering services for its smelter in Quebec, Canada. ABB’s solutions will provide greater operational flexibility and productivity on both pot lines, and improved overall energy efficiency for the smelter. The order was booked in the first quarter of 2010.
Aluminerie Alouette is the largest aluminum smelter in the Americas and the fifth largest in the world. It produces about 575,000 metric tons of primary aluminum ingots per year.
ABB will supply a turnkey rectifier / transformer package that includes a DC bus system, integration with existing controls/Supervisory Control And Data Acquisition (SCADA) systems, as well as engineering, installation and commissioning services. The project will be executed by ABB's Aluminium Execution Center based in Montreal, Canada.
The new rectifier system is scheduled to be fully operational in August 2011.
"This order reflects Aluminerie Alouette's confidence in our integrated solutions for control, plant optimization, and application know-how," said Veli-Matti Reinikkala, head of ABB’s Process Automation division. "Our goal is to help Alouette increase productivity and energy efficiencies while reducing overall costs."

Alro forecasts double profit in 2010
ACTmedia - Mar 30, 2010
The largest aluminium producer in the Central and Eastern Europe, Alro Slatina (south-west of Bucharest) estimates 57 million dollars net profit in 2010, almost double as 30.7 million dollars in 2009, according to a news release sent Bucharest Stock Exchange.
The aluminium producer budgeted a turnover of 580 million dollars, around 25 percent higher than last year, which amounted to 463.8 million dollars. Alro representatives claim that the estimates were made based on the evolution of aluminium demand and prices. 'It is our intention to invest in strengthening the capacity of higher value-added products and, at the same time, in cutting costs, improving the efficiency and quality as well as the working conditions,' daily Financiarul quotes vice-chairman of Alro's Board of Directors Marian Nastase as saying.
Alro's investment budget this year amounts to 15.28 million dollars, as compared to six million dollars in 2009, a year that witnessed significant reductions because of the economic crisis effects. At the same time, the aluminium production will increase by 13.5 percent, from 201 thousand tons to 228 thousand tons. The main stakeholder is the global primary and processed aluminium company Vimetco, controlled by the Russian businessman Vitali Matsitski.
Alro management budgeted an increasing business and profit for the alumina refinery Alum Tulcea (north-east of Bucharest), also owned by Vimetco. Thus, the net profit will increase from 4.45 million dollars to 5 million dollars, and the turnover from 25.6 million dollars to 149 million dollars.Alum budgeted an investment programme worth 6.23 million dollars for 2010.
'The company will invest in automation, specific consumptions reduction and efficiency increase. It will also carry on with the programme of building an installation which allows the thick slime to be stored in line with the

Ormet Signs Agreement to Purchase Carbon Anode Facility
Business Wire (press release) - 30-Mar-2010
HANNIBAL, Ohio--(BUSINESS WIRE)--Ormet Corporation, a top U.S. producer of aluminum, today announced that it has entered into a Purchase and Sale Agreement for the purchase of a carbon anode facility located in Mead, Washington. If the purchase is completed, the carbon anode facility would be used to supply the company’s Hannibal, Ohio smelting operation. The Mead carbon plant has the potential of supplying part of or nearly all of the anode needs for Ormet depending on the amount of capital invested. The carbon anode facility would allow the company greater flexibility in the sourcing of this key raw material since the company could balance internal production versus import requirements, based on price, quality and risk. The next step will be to conduct detailed due diligence leading to a final purchase decision near the end of the second quarter of 2010. The Purchase and Sale Agreement contains customary conditions precedent to closing.
“Developing a domestic source would allow us to fully recycle carbon residues, reduce our cost and better control price risk depending on global market conditions.”
“Carbon anodes are a strategic raw material for our operation,” says Mike Tanchuk, Ormet’s president and CEO. “Developing a domestic source would allow us to fully recycle carbon residues, reduce our cost and better control price risk depending on global market conditions.”

BHP Billiton Says Alumina Industry Needs Clearer Pricing
Easy Bourse - 30-Mar-2010
LONDON -(Dow Jones)- The alumina industry needs a clearing price against which long-term contracts settle, a senior executive at BHP Billiton PLC (BHP) said Tuesday.
The company has for some time been advocating a move of alumina pricing away from the traditional method of benchmarking it as a percentage of the London Metal Exchange aluminum price.
This has already happened in other markets such as thermal coal and iron ore, Jon Dudas, BHP's president of aluminum, said in a presentation posted on the company's Web site.
Factors encouraging a similar move in alumina include a sharp rise in demand that has led to the development of a spot market, the emergence of new entrants such as China, with flexible but high-cost positions, and a sharp divergence in spot contracted prices, driving the evolution of a new pricing structure, Dudas said.
The outcome for industries involved in the new pricing structure has been positive, he noted.
"Lower cost supply has been generated, greenfield basins have been opened up and supply outcomes have become more equitable," he said. "There's also an increased ability to hedge exposures, increased transparency, new market participants providing liquidity have been attracted while pricing closer to the market reduces contract performance issues." -By Andrea Hotter, Dow Jones Newswires; +44 (0)20 7842 9413; andrea.hotter@dowjones.com

Chalco Plans $2.1 Billion of Spending, Seeks Power Investments
San Francisco Chronicle - 30-Mar-2010
(Bloomberg) -- Aluminum Corp. of China Ltd., the nation's largest producer of the metal, is planning 14.6 billion yuan ($2.1 billion) of capital expenditure this year and is seeking investments in coal and power.
The company known as Chalco wants to buy coal mining rights in China and invest in aluminum plants in Saudi Arabia to benefit from cheaper power, Chairman Xiong Weiping said today at a press conference in Hong Kong. Chalco will increase capital expenditure by 36 percent, including 3 billion yuan ($440 million) for overseas project, he said.
Higher-than-expected costs led to the fourth-quarter loss for Chalco, and the metal producer will face "continued" pressure, according to a report by Goldman Sachs Group Inc. yesterday. Aluminum consumption in China, the biggest consumer, will expand by at least 20 percent this year, driven by an economic recovery, Chalco said March 23.
"The company will enhance coal and power investments to realize low-cost production," Xiong said. It will also phase out outdated aluminum plants and build new smelters in areas with "rich" coal and hydro power resources, he said.
Beijing-based Chalco rose 2.7 percent to close at HK$8.13 in Hong Kong trading. Alumina is a semi-finished material used to make aluminum metal.
About 40 percent of Chalco's production costs for aluminum came from alumina, and 35 percent from power, according to the March 29 Goldman Sachs report.
Capital Spending
Chalco will boost capital spending from 10.7 billion yuan last year, Xiong said. Of the money earmarked for overseas projects, some will be for feasibility studies, he said, without giving details.
The plan to restructure the company's production base and increase investments in power should be completed in three years.
Chalco has signed five power agreements that will help reduce costs by 54 million yuan a month, Xiong said. The company is also seeking to speed investments in bauxite, a material used to make alumina, he said.
The metal producer posted a fourth-quarter loss of 1.1 billion yuan on March 26, missing the mean estimate of a profit of 1.4 billion yuan of 20 analysts compiled by Bloomberg.
The company will close 1 million metric tons of outdated alumina production capacity and 200,000 tons of outdated aluminum plants by the end of this year, said Vice President Liu Xiangmin at the same conference today.
--Xiao Yu. Editors: Tan Hwee Ann, Richard Dobson.

Australia's Smith Says Hu Verdict May Harm China Business Ties
BusinessWeek - March 29 (Bloomberg)
The Chinese trial and convictions of four Rio Tinto Group executives may harm business confidence in the world’s fastest-growing major economy, Australian Foreign Minister Stephen Smith said.
Stern Hu, an Australian citizen who headed Rio’s iron ore business in China, was sentenced today to 10 years in jail and fined 1 million yuan ($146,491) after being convicted of taking bribes and stealing commercial secrets. Three others were also imprisoned in a case that frayed ties with Australia after Rio rejected a $19.5 billion investment from China last year.
“There are serious unanswered questions and some of those questions go directly to the confidence that the international business community can or will have in doing business in China,” Smith told reporters in Canberra. “This was an opportunity for China to bring some clarity to the notion or question of commercial secrets. That opportunity was lost.”
Hu and colleagues Liu Caikui, Wang Yong and Ge Minqiang pleaded guilty to the charges and were found guilty in a Shanghai court after a three-day trial last week. The four were sentenced to between 7 and 14 years in jail.
“On the bribery charge, this seems to me to be a very harsh sentence,” Smith said. “On the commercial secrets matter, because we have had no access to that part of the trial, there are I think serious unanswered questions that the international business community will want to continue to pursue with China.”
Guilty Pleas
The four pleaded guilty to receiving 92.18 million yuan between them in bribes, China’s state news agency Xinhua reported on March 23, citing court documents.
Hu may be able to serve some of the jail sentence in Australia, if a prisoner exchange agreement that both countries are considering is ratified, Smith said. Hu will be sent to a Shanghai prison and his family will be able to see him, he added.
China is Australia’s largest trading partner, with a two- way relationship worth A$83 billion ($75 billion). Iron ore makes up half, or A$22.1 billion, of Australian exports to China. The country is also Australia’s largest source of overseas students and 15th largest investor.
Rio, the world’s second-largest iron ore exporter, rejected a $19.5 billion investment from state-owned Aluminum Corp. of China a month before Hu and his Chinese colleagues were detained.
‘Can’t Stop Trading’
“Rio obviously can’t stop trading with China,” Vivienne Bath, associate professor at the Sydney Law School, University of Sydney, said after the verdict was released. “It is a very big and important entity for them, and they wouldn’t necessarily take the message out of it that they have been victimized.”
Rio’s Australian listed shares today rose 7 cents to A$78.39.
“The economic relationship between Australia and China has been growing,” Treasurer Wayne Swan told reporters in Canberra on March 25. “I don’t believe it was ever off track.”
Australian Prime Minister Kevin Rudd, a Mandarin-speaking former ambassador in Beijing, said before the trial the world would watch the process closely. Rudd has traveled to China twice since taking office and 12 of his government ministers have visited as well.
--Editors: John Brinsley, Mark Williams.
To contact the reporters on this story: Gemma Daley in Canberra at gdaley@bloomberg.net; Marion Rae in Canberra at mrae3@bloomberg.net
To contact the editor responsible for this story: Bill Austin at billaustin@bloomberg.net

Chalco reports losses in 2009 on low product prices
China Daily - 28-Mar-2010
BEIJING: The Aluminum Corporation of China Limited (Chalco), the country's top aluminium producer, reported losses in 2009 as average prices of its major products were lower compared to a year ago.
Net losses in 2009 stood at 4.65 billion yuan ($681 million) while the company netted 9 million yuan of profit in 2008, according to the company's annual business report filed to the Shanghai stock market.
The report did not say how much the average prices of its major products dropped, but said the "price plummet has posed unprecedented pressure and challenges" to the production and operation of the company.
Business revenue was 70.27 billion yuan, down 8.42 percent compared to a year ago.
The Aluminum Corporation of China is Chalco's largest shareholder. It holds a 38.56 percent share of Chalco.

RPT-Chalco returned to profit in Jan-Feb -CEO
Reuters India - 28-Mar-2010
SHANGHAI, March 29 (Reuters) - Aluminum Corp of China Ltd (2600.HK: Quote, Profile, Research)(601600.SS: Quote, Profile, Research)(ACH.N: Quote, Profile, Research), the world's biggest aluminium company by market value, returned to profit in the first two months of the year, its chief executive said on Monday.
Chalco posted an unexpected loss in the fourth quarter of 2009, as higher costs more than offset rising metals prices.
Xiong Weiping, chairman and chief executive officer of the company, said that he expects aluminium prices to fluctuate between $2,000 to $2,400 a tonne in the global market and 15,500 to 18,000 yuan a tonne in the domestic market.
Chalco also expects China aluminium consumption at 16.5 million tonnes in 2010. The firm also expects 2010 global aluminium production capacity at 51 million tonnes, output at 41.6 million tonnes and consumption at 39.4 million tonnes.
Chalco produced 7.78 million tonnes of alumina in 2009, and 3.44 million tonnes of aluminium.
Chinalco, Chalco's parent company, said earlier this month that it signed a $2.9 billion agreement with Anglo-Australian miner Rio Tinto (RIO.AX: Quote, Profile, Research) to jointly develop an iron ore project in Guinea. [ID:nSGE62I09U] (Reporting by Rujun Shen, Li Hongwei and Edmund Klamann; Editing by Jason Subler)

India threatens to move WTO on carbon tax issue
Hindu Business Line - 28-Mar-2010
New Delhi, India has warned that it could exercise the option of moving the WTO Dispute Settlement Body if the European Union and the US impose carbon tax on Indian exports.
“If they impose such a tax, we will take them to the WTO dispute settlement forum,” the Environment Minister, Mr Jairam Ramesh, told Business Line.
Indicating that there is every possibility of imposition of such an import barrier by the developed countries, Mr Ramesh said, “We will deal (with this) through hard negotiations. Such barriers are not going to be WTO-compatible and we will fight it”.
Stating that BASIC countries — Brazil, South Africa, India and China — were united on the issue of fighting carbon tax proposed by the rich countries, Mr Ramesh said, “China has more at stake than India, considering its volume of trade”.
Following the collapse of the Copenhagen Summit, the US and the EU have hinted at the levy of carbon tax on imports to force large polluters, especially the developing nations such as China and India, to take a clean environment stance. The US and the EU had also attempted to link climate and trade issues.
Carbon tax is an environmental tax on carbon emissions. However, the EU and the US have been threatening to use carbon tax on exports from developing countries under the guise of controlling emissions.
India had opposed attempts by the rich nations to mix trade and climate matters. India, which is against any legally binding agreement, had voluntarily agreed to reduce its carbon emissions by 20-25 per cent by 2020.
Studying possible impact
Meanwhile, the Commerce Ministry is studying the possible impact of the proposed carbon tax on India's exports of items such as steel, iron, aluminium, cement and chemicals.
Reports from Brussels said that the European leaders participating at an EU Summit on Friday were divided on the issue of levying carbon tax.
However, the French President, Mr Nicholas Sarkozy, urged the EU leaders to agree to such a tax.

EMAL goes to Dubai careers in search of talent
Zawya - 28-Mar-2010
Abu Dhabi, 28 March, 2010: The human resources and recruitment team of Emirates Aluminium Company
(EMAL) met with Emirati job seekers on Sunday during the first day of Careers Dubai - an annual career fair that brings together employers and a diverse array of candidates, from recent graduates to seasoned professionals.
"We're very pleased with the results of the first day," said Saeed Al Mazrooei, the CEO of EMAL.
"Our primary purpose in being here was to encourage Nationals from Emirates outside of Abu Dhabi to consider a career with us, and we believe we have been most successful in that regard."
EMAL is one of the largest industrial projects in the UAE outside of oil and gas and is the cornerstone of Abu Dhabi's industrialisation and diversification strategy.
"Every day, we're playing a role in creating the future envisioned in Abu Dhabi's plan for 2030," said Mazrooei. "Emiratis from all seven Emirates can be proud of the work we are doing, and we are here at this career fair to let them know they are welcome to join us in building a bright future for this great country."

Riyadh catches up on aluminium
MEED (subscription) - Mar 28, 2010
Plans to launch financing for the Ras al-Zour scheme will put the megaproject on track for completion
At the recent MEED Middle East Aluminium conference in Dubai, attendees were in better spirits than they had been a year before.
Talk was of aluminium demand growing by 12 per cent in 2010 and prices for the metal rising to $2,200 a tonne compared to $1,200 a tonne a year before.
Most GCC states had representatives talking about new smelter projects or developments in downstream aluminium. The only exception was the biggest of them all, Saudi Arabia.
But the kingdom is finally getting its act together. MEED reveals this week that Saudi Arabian Mining Company will launch the financing for a $7bn, 740,000 tonnes-a-year (t/y) aluminium smelter in May.
The project is a joint venture between Saudi Arabian Mining Company and the US’ Alcoa. Other projects planned as part of the venture include a 1.8 million t/y alumina refinery alongside a rolling mill with a capacity of up to 460,000 t/y and a 4 million t/y bauxite mine.
The argument for aluminium production in the kingdom is compelling. Smelting aluminium requires a huge amount of energy, something that will not worry oil-rich Saudi Arabia.
With an abundance of bauxite, the mineral used to produce aluminium, Riyadh can develop its own supply chain from mine-shaft to end-product. And having the technical expertise to turn the base mineral into products to meet domestic demand and exports, is an enviable position to be in.

Saudi phosphate railway complete by 2010 end
ArabianBusiness.com - Saturday, 27 March 2010
RAILWAY OPERATION: A railway that will serve a Saudi Arabian Mining Co project is expected to be in operation by the end of the year. (Getty Images)A railway to transport phosphate and bauxite ore that would serve a project Saudi Arabian Mining Co is developing is expected to be in operation by the end of this year, state news agency SPA said on Saturday.
The mineral line would link the phosphate mine at al Jalamid and the bauxite mine at Az Zabirah to the processing facilities at Ras Azzour, on the Gulf coast.
As reported by the SPA, Rumaih al Rumaih, deputy chief executive. Saudi Railyway Company, said: "So far, 800 kilometers of the 1486 km railway has been executed."
The state owned firm has signed a contract worth $74.13 million Indian government firm Rites to operate the railway, SPA said.
The contract would last till the end of 2013, SPA added.
Maaden, in a joint venture with Saudi Basic Industries Corp (SABIC) is doubling capacity at its Saudi fertiliser plant to 6 million tonnes per year. The project will use phosphate from a deposit at al Jalamid and local gas and sulphur supplies to manufacture the fertiliser diammonium phosphate (DAP).
Maaden is also building with US aluminium giant Alcoa a $10.8 billion aluminium complex at Ras Azzour which would start production in 2013.
Maaden has said both the phosphate and aluminium projects rely on the development and operation of a port to export DAP and ammonia for the phosphate project and for the import of raw materials, and export of alumina and aluminium for the aluminium project. (Reuters)

Aluminium smelters have yielded 'enormous' benefits, study shows
Creamer Media's Engineering News - 25th March 2010
A previously confidential report, which has been released to Engineering News Online, offers an entirely different take on the value of BHP Billiton's aluminium smelters in Southern Africa, which critics largely blame for South Africa's prevailing power constraints.
The 176-page Econometrix study claims that the smelters have yielded "enormous" benefits to the region and defends the power supply contracts with Eskom, which opponents describe as iniquitous, as having been pursued correctly when South Africa had surplus electricity capacity.
Details of the report, which was commissioned in 2008 by BHP Billiton, arise as the matter has become the subject of a court case and a Parliamentary enquiry. They also follow on from an Eskom assertion that the commodity-linked deals are "unsustainable". In fact, the utility attributed the bulk of its record near R10-billion loss of 2008/9 to its contracts with the smelters, which reportedly consume as much as 5% of the country's power.
The smelters became the focus of public outrage at the height of South Africa's 2008 load-shedding crisis, when then Standard Bank chairperson Derek Cooper controversially suggested that the system could be immediately stabilised if Eskom simply ended its generous supply arrangement with BHP Billiton.
The resources giant has three aluminium facilities in the region: Hillside (commissioned in 1996) and Bayside (commissioned in 1971, with an expansion in the early 1980s) are located in Richards Bay; and Mozal (built between 1998 and 2002) is in Maputo, Mozambique.
Under the terms of its contract with Eskom, BHP Billiton pays less for power when the aluminium price falls and more when it climbs. For Eskom, the economic crisis of 2007 and 2008, which led to precipitous declines in commodity prices, including the price of aluminium, blew in the perfect storm, with large chunks of power reportedly supplied to the smelters at below cost.
Eskom and government are currently trying to renegotiate these controversial contracts, but a veil of secrecy has been thrown over the details of these discussions.
Meanwhile, the Econometrix report, which was commissioned by BHP Billiton in 2008, when the aluminium price was high, and the rand relatively weak, paints a positive picture of the contribution of the smelters.
At the time of publication, authors Tony Twine and Robert Jeffrey wrote that the "benefits have had a very broad impact and reach, far beyond and more extensively than the relatively narrow reach of many labour-intensive local and regional development projects."
The report concludes that the industry has played and continues to play an important role in the region and contributes substantially to the overall economic performance of South Africa.
The smelters employed more than 3 200 employees and 2 800 contractors when the report was written, contributing R1,3-billion in corporate tax to the South African and Mozambique governments. In total, it was estimated that about 100 000 South African citizens depended on the Bayside and Hillside smelters for their livelihoods.
Foreign currency earned from exports, meanwhile, was more than R21-billion. Therefore, even after imports of about R9-billion, the direct positive impact on the Southern African regional current account of the balance of payments in 2007 was estimated to be R12-billion, excluding the flow of dividends abroad.
In sum, the warning was that should the smelters be starved of power, the region would lose valuable export earnings, which would have a big impact on the country's balance of payments. Together, Econometrix estimated that the facilities comprised around 1% of gross regional product. "Mozal is Mozambique's largest foreign exchange earner, generating 53% of its earnings," Twine and Jeffrey wrote.
However, the picture has altered substantially since 2008. The aluminium price collapsed from over $3 000/t in 2008 to some $1 300/t in March 2009, leading to the now notorious embedded derivative losses at Eskom. The price is currently around $2 200/t.
The much lower reserve margin led to the load shedding of 2008, as higher demand bumped into serious supply-side problems, precipitated by low coal stockpiles.
But Econometrix asserts that the tighter supply/demand balance was not due to excessive demand growth, or a sudden increase in demand caused by the smelters. "Rather, it is a supply problem, which should have been planned for and solved prior to 2004."
Should BHP Billiton now be punished for government's failure to plan properly?
The report argues that the answer should be a resounding no. It even avers that the decision to proceed with the development of the aluminium industry was, "at that stage in the country's development, correct".
"The government must minimise the damage to all goods-producing industry in the country and the aluminium smelting industry should not be prejudiced in any rationing process," it said, referring to calls for the smelters to be shut.
"The benefits of the aluminium smelting industry are enormous, in terms of jobs created, taxes paid, foreign currency earned, community contributions and purchases from local suppliers.
"The industry is a sound and long-term contributor to the economy and adds considerable value to a resource, which South Africa has in plentiful supply, namely coal."

European 'Anti-Dumping' Investigation Could Mean 30% Duty on Chinese Alloys
Tyrepress.com - 24 - Mar -2010
While everyone has been focusing on the US-initiated anti-dumping tariffs against Chinese-made passenger car tyres, another anti-dumping investigation has escaped widespread coverage. On 13 August 2009 the European commission began an investigation into dumping allegations made against Chinese wheelmakers who allegedly sold products into the European markets beneath cost price. At the time 60 Chinese wheelmakers received notification of the impending investigation and most reportedly began cooperating straight away. Nevertheless, according to China’s Ministry of Commerce, the investigation is likely to cost Chinese wheel exporters an estimated US$390 million. There is still a chance that no tariffs will be implemented, but if they are they will apply across both the OE and replacement sectors and are predicted to be lie somewhere around the 30 per cent mark. The European Commission’s investigation, which began just a day after the Chinese companies involved were informed of the allegations, followed a complaint made by the Association of European Wheel Manufacturers’ (EUWA) in June 2009. At the time the journal of the executive arm of the 27-nation European Union said the investigation was initiated “having determined that there is sufficient evidence to justify the…proceeding.” However, China's Ministry of Commerce denied the charges saying: “It raises the cost of repairs for customers, affects the recovery of the European auto sector from the global financial crisis, and hurts the interests of both China and Europe.” Either way, with Chinese produced wheels representing a significant proportion of replacement market products on offer, any kind of trade barriers that are implemented are likely to have a similarly significant effect on the shape of the market.
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ADBIC plans aluminium rolling mill at Khalifa Port in Taweelah
SteelGuru - 23-Mar-2010
MEED reported that Abu Dhabi Basic Industries Corporation is planning to build USD 1.5 billion aluminium rolling mill with a capacity of 500,000 tonnes per year at Khalifa Port and Industrial Zone in Taweelah.
Mr Juan Gomez Cardobes VP for metals of ADBIC said that while he is not ready to disclose the JV partner in the project, a site has been identified and is ready for construction work to begin. We need to break ground in the Q1 of 2011 so we are hoping to issue tenders in the Q3 and award the contracts in the Q4 of 2010.
He said that at the moment we have not discussed contracting strategy with our partner and it is not clear which direction we are going to take.
Mr Jamal Salem Al Dhaheri CEO of ADBIC said what his company will be looking for in regards to potential contractors. It is always best to have a competition and make it as transparent as possible. It is important that the contractors have experience with large aluminium projects as well as good local knowledge.
Mr Al Dhareri also explained why the new world scale mill will be a unique addition to the Middle East aluminium industry. The technology we are putting in the mill will be capable of supplying many diverse markets and that is unique to this region. One of the key targets is Middle East can manufacturers, for example. However, whenever we discuss new projects, we don’t talk about just the local markets, but that is a good place to start.
The rolling mill is ADBIC’s third project at the proposed metals park at KPIZ and is scheduled for completion in the Q1 of 2013. The company is also building an aluminium extrusion plant with Gulf Extrusions Company as well as an aluminium rod plant with Midal Cables.
(Sourced from MEED)

Aluminum Demand in China to Expand 20% in 2010, Chalco Says
BusinessWeek - 22-Mar-2010
Aluminum demand in China will expand by 20 percent this year to about 17 million metric tons, Aluminum Corp. of China Ltd. said.
Output may reach 17.5 million tons, Liu Xiangmin, vice president of the Beijing-based company known as Chalco, said today at a conference in Singapore.To contact the reporter on this story: Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: Hwee Ann Tan at hatan@bloomberg.net

Venezuelan electricity crisis deepens
Financial Times - March 22 2010
A deepening electricity crisis in Venezuela is taking its toll on businesses, as 80 companies were punished on Monday with power cut-offs for 24 hours after failing to comply with a strict rationing plan.
Companies affected by the sanctions include the local unit of Sony Corp, as well as a number of restaurants, liquor stores, hotels, gyms, car dealerships and a yacht club.
Severe electricity shortages prompted the government last month to demand businesses cut electricity usage by 20 per cent. President Hugo Chávez has announced a national emergency due to record lows in hydroelectric reservoirs that threaten to shut off more than a third of the OPEC country’s power generation. If the rainy season starts late this year – it is usually in May – blackouts and rationing could worsen.
In an attempt to limit electricity consumption, government offices are closing at lunchtime, shopping malls are opening late and stores have cut use of refrigeration and lighting. Heavy industries, including major steel and aluminium factories, have reduced production to less than 50 per cent.
If the companies sanctioned on Monday fail to improve their energy-saving performance, they risk a three-day cut-off, then indefinite suspension of power.
The seriousness of the crisis is leading analysts to predict a prolonged recession in Venezuela, which depends on hydroelectricity for over 70 per cent of its power. After a contraction in gross domestic product of 3.3 per cent in 2009, many economists are now expecting a similar performance this year.
President Chávez’s popularity is also suffering, giving his opponents a chance to regain influence in the national assembly elections in September, after boycotting the last legislative elections in 2005. Local pollsters such as Datanalisis put the radical leader’s approval ratings at about10 percentage points lower than a year ago, with particular dissatisfaction expressed at the government’s handling of the power crisis.
Although Venezuela was hit by a drought last year caused by the meteorological phenomenon known as El Nino, mismanagement and a lack of investment in infrastructure have squeezed generation capacity. The problem has been exacerbated by rapid population and economic growth in recent years, as well as tariff freezes that have contributed to making Venezuelans the highest consumers of electricity in Latin America.
Mr Chávez says the opposition is taking advantage of the shortages to discredit him. “This (opposition) campaign has, of course, one single aim: declare Hugo Chávez guilty of everything, even the drought,” he wrote in his latest Sunday newspaper column. “I would love to have the powers I’m accused of by the opposition to defeat this situation which not only hurts Venezuela but the whole world as a result of the destructive voracity of the capitalist system.”
Analysts are sceptical of Mr Chávez’s promises to add nearly 6 gigawatts of thermoelectric energy this year, which would boost national capacity to around 30 gigawatts and close the gap between demand and supply. Increased dependence on thermoelectric energy will hit energy exports, with the government expecting local consumption of fossil fuels to rise by as much as a third this year.

Hilco Industrial Completes Sale of Aleris Aluminum Foil Plant
Business Wire (press release) - 22-Mar-2010
FARMINGTON HILLS, Mich.--(BUSINESS WIRE)--Hilco Industrial, LLC, a leading distressed asset disposition and acquisition company, and its joint venture partners, announced the sale of an aluminum foil production facility, formerly owned by Aleris International, a global producer of aluminum rolled and extruded products, recycled aluminum, and specification alloys.
The plant, located in Three Rivers, Quebec, Canada, was purchased by the joint venture from the estate of the bankrupt company for $10.5 million. Hilco then launched a worldwide marketing campaign to sell the facility in its entirety. An auction was staged on March 10, 2010, which drew more than 200 bidders. The winning bid for the facility in its entirety was from an undisclosed buyer located in the Peoples Republic of China.

RUSAL claims initial win in Guinea court battle
Reuters South Africa - 22-Mar-2010
CONAKRY (Reuters) - Aluminium producer RUSAL has won a stage in an ongoing legal battle with Guinea over ownership of the Friguia alumina refinery in the West African country, the firm said on Monday.
The Guinean appeal court overturned a ruling by a lower court last September that said RUSAL bought Friguia illegally in 2006, vastly underpaying for Guinea's largest industrial project. Guinea can in turn appeal against this latest decision.
Since the September ruling, the two sides have said they would negotiate, a move seen as paving the way for RUSAL to carry on running the plant, which can produce 640,000 tonnes of aluminium feedstock alumina per year, and is a major employer in the poor country.
"RUSAL views this decision as providing a favourable step toward expanding the long-term and mutually beneficial cooperation between RUSAL and the Republic of Guinea," the firm said in a statment on Monday.
"It's a separate procedure from our campaign to get what is due to us financially," Guinea's Mines Minister Mahmoud Thiam told Reuters, adding he was not aware of the appeal court's decision.
Thiam was reappointed to head the mines ministry last month when authorities named a transitional government which is intended to usher the country, whose income depends on mineral exports, to democratic elections.
That vote, scheduled for June, is intended to end a political crisis that has persisted since a Decmber 2008 military coup in the world's biggest bauxite exporter.

Russian Aluminium Smelter gets Thimble Press from VHE
Azom.com - 21-Mar-2010
VHE of Iceland - has installed a thimble press at Rusal's Sayanogorsk smelter as part of a development process line in the rodding plant.
The VHE Stimir thimble press is an hydraulically powered compact unit and is able to exert up to 200 tonnes of dynamic force to remove single thimbles from the yoke assembly.
In the Sayanogorsk installation the rod assembly is suspended from an overhead crane and each stub in turn is guided into the press. Operation is by manual pushbutton and the thimble stripper is able to strip thimbles from two different designs of yoke.
The design is easily modified for automatic processing of rod assemblies travelling in an overhead conveyor.

Montenegro budgets loan guarantees for aluminum plant
SteelGuru - 20-Mar-2010
Reuters reported that Montenegro's government had budgeted EUR 85 million for loan guarantees to its sole aluminium producer Kombinat Aluminijum Podgorica.
The finance ministry said in a statement that of the total EUR 85 million, 22 million will back a new loan to secure production in KAP, while another EUR 63 million will be used to reschedule previous debt. KAP is currently in the process of negotiating EUR 22 million loans with creditors.
The KAP facility has run losses since global metals prices fell last year. In the past it has contributed more than 15% of the gross domestic product, it accounted for 41% of exports in the first 8 months of 2009.
Recently, the finance ministry said that the government had guaranteed a EUR 49.7 million loan from OTP Bank to KAP. That month, EN+, owned by Russian tycoon Mr Oleg Deripaska, said that the government of Montenegro would issue guarantees up to EUR 135 million to cover loan repayment and redundancy.
(Sourced from Reuters)

Alcoa gets energy chill from Australia's $130bn gas boom
The Punch - 19-Mar-2010
Australia is attracting more than $130bn of investment in some of the world‘s richest natural gas fields to supply buyers in Japan and China. Domestic customers, including Alcoa Incorporated, will have to wait.
Bloomberg reported on Thursday, that Alcoa‘s stalled alumina refinery expansion in Western Australia ”will not be back on the agenda until we can secure long-term competitive gas supply,” Michaela Southby, a Perth- based spokeswoman for the biggest United States aluminum producer, said in an e-mailed response to questions. The project may cost $4bn, according to a 2008 estimate by ABN Amro Holding NV.
Royal Dutch Shell Plc plans to deploy a production vessel larger than an aircraft carrier off the coast of Western Australia to feed the liquefied natural gas boom that may see annual exports hit almost A$40bn by mid- decade. The state‘s gas shortage will last to at least 2020, hindering mine projects, according to the DomGas Alliance.
”You have all this energy and gas but most of it‘s exported,” said Peter Arden, a Melbourne-based mining analyst at Ord Minnett Limited, a JPMorgan Chase & Company affiliate. ”It‘s going to be a really big cost input for the whole of Western Australia, especially the miners who rely on it for power.”
Alcoa, the biggest user of gas in Western Australia, gained 4.8 per cent to close Wednesday at $14.46 in New York Stock Exchange composite trading. The stock has dropped 10 per cent this year. Alumina is used to make aluminum. LNG is gas chilled to liquid form for shipping.
New York-based Alcoa suspended a plan to double capacity at the Wagerup refinery more than a year ago because of the financial crisis and gas supply constraints. Gas prices in the state, the source of half Australia‘s commodity exports, rose almost fourfold in the past decade and may keep rising until supply becomes available, said consultant ACIL Tasman Pty.
”The prices that are being asked will certainly preclude the development of a lot of future projects,” Tony Petersen, chairman of DomGas, a user‘s group that includes Newmont Mining Corp. and Fortescue Metals Group Limited, said in an interview.
More than 1,000 mine sites operate in Western Australia, which generates 70 per cent of the nation‘s exports to China, the biggest buyer of raw materials. The nation is the largest shipper of iron ore, alumina, lead, zinc and coal. It ranked sixth among LNG exporters in 2008.
Mining magnate Clive Palmer‘s Australasian Resources Limited. and Atlas Iron Ltd. and are among companies planning at least A$50bn of projects and expansions in Western Australia and will be competing for gas.

DJ Anglo Aluminum Acquires Guinea's Mamou-Dalaba Bauxite Property
Trading Markets (press release) - Mar 19, 2010
LONDON, Anglo Aluminum Corp. (ALU.V) has acquired the Mamou-Dalaba bauxite property in Guinea from a local company and is moving ahead quickly with exploratory drilling, it said Friday.
The company has now retained Perth-based Coffey Mining to complete a preliminary assessment of the project, which comprises four exploration permits.
The property was previously 100%-owned by Societe Guineenne de Fer et de Bauxite, a local Guinean company that holds the four Mamou-Dalaba bauxite permits and which Anglo Aluminum bought.
SGFB also holds 14 base metals and four iron ore permits in the Beyla and Kankan areas, and three uranium permits in the Beyla area in southeastern Guinea.
Anglo Aluminum has two flagship projects in Guinea--Koba and Koumbia--where a preliminary economic assessment is being organized.
-By Andrea Hotter, Dow Jones Newswires; +44 (0)20 7842 9413; andrea.hotter@dowjones.com

China Dongxing Aluminium blast halts plant output
Reuters AlertNet - 19 Mar 2010 08
Source: Reuters
HONG KONG, March 19 (Reuters) - A smelting unit of Dongxing Aluminium Co in China's Gansu province has stopped production following an explosion, state-run news website people.com.cn said on Friday.
The explosion, which occurred on March 16, injuried 27 workers and damaged the smelting plant, a report posted on the Gansu government website on that day showed. (www.gansu.gov.cn)
The report did not give the capacity of the plant or say when it would resume operations.
Officials at Dongxing were not immediately available for comment.
State-owned Dongxing had an aluminium smelting capacity of 180,000 tonnes per year in 2008 and planned to double the capacity, according to a brief posted on the website of the State-owned Assets Supervision and Administration Commission website. (www.sasac.gov.cn)
China, the world's top producer and consumer of aluminium, has more than 18 million tonnes of annual primary aluminium capacity

Talks Proceed on Huge Aluminum Smelter Project in Paraguay
Latin American Herald Tribune - 18-Mar-2010
ASUNCION – Representatives of Rio Tinto Alcan, a unit of global mining giant Rio Tinto, met Thursday with Paraguayan President Fernando Lugo for a new round of talks on a potential $2.5 billion aluminum smelter.
The delegation, which had previously met with Finance Minister Dionisio Borda, was received by the head of state during a meeting with his economic team.
Afterwards, Borda told reporters that the plan is for the smelter to be built in the country’s southwest – near the Itaipu and Yacyreta hydro-electric dams that Paraguay jointly operates with Brazil and Argentina, respectively – and to start operating in 2016.
The plant would be the country’s biggest public-works project since the construction of the Itaipu and Yacyreta complexes, both on the Parana River.
“First a technical-market study has to be carried out, and when that’s finished we can have a more complete idea” of the project, Borda said when asked about the viability of the investment.
The first contacts between Rio Tinto Alcan and the government date back to mid-December, when a delegation from the company signed a letter of intent on an energy-purchasing agreement with Paraguay’s National Electricity Administration.
“This potential aluminum smelter project would benefit from both our clean, efficient, world-class technology, and our expertise in sustainable development. Our leading technology and production processes are respected throughout the industry,” Rio Tinto Alcan executive Sandeep Biswas said then.
The Anglo-Australian Rio Tinto Group, which employs more than 90,000 people in more than 50 countries, finds, mines and processes mineral resources. Its main products are aluminum, copper, energy (coal and uranium), gold, industrial minerals (borax, titanium dioxide, salt, talc) and iron ore.

Marine Cable from Iceland to Scotland?
IcelandReview - 19-Mar-2010
The main producers of marine electric cables believe it is viable to establish such a cable from Iceland to Scotland. The cost would probably be considerably lower than what it cost to construct the Kárahnjúkar dam and industrial companies in Europe would pay up to four times the price which large-scale industrial companies in Iceland pay for energy.
A marine cable transporting electricity from Iceland to the Faroe Islands has proven profitable. Therefore producers, including Siemens, are now looking into the possibility of a 935-kilometer long cable transporting electricity from Iceland to Scotland, RÚV reports.
The longest marine cable of this kind, which is 580 kilometers, connects Norway and the Netherlands. When the price of establishing that cable is taken into consideration, the Iceland-Scotland cable would clearly be expensive.
However, Ketill Sigurjónsson, an economist and specialist in energy affairs, still believes it is an economical option.
“When we consider the price of such a cable it would probably be sufficient for Iceland to sell the electricity for 40 mills to Europe to make it financially viable,” he reasoned.
According to a secret document which was leaked to the media recently, Nordurál – Century Aluminum pays 25 mills for energy. The average price for energy in Europe is around 70 mills. The industrial price for energy is around 100 mills.
The comparison with China, where a number of new aluminum smelters have been built in the past years, is rather bleak for Iceland.
“There the average price is around 50 to 60 mills […]. If the average price is 25 mills in Iceland I would say there is something wrong with the agreements that were made,” Sigurjónsson commented.

Italy okays power decree to keep Alcoa units working
Reuters - ROME, March 17, 2010
Italy's parliament approved on Wednesday a power decree offering favourable conditions to some industrial consumers aimed to convince U.S. aluminum producer Alcoa Inc (AA.N) to keep its Italian plants working.
In November, Alcoa said it would temporarily idle its 194,000-tonne-per-year smelters at Portovesme in Sardinia and Fusina near Venice after the European Commission ordered it to pay back most of the state aid it had received in Italy since 2006. Alcoa has complained about high power prices in Italy.
Under the new decree, power lines connecting mainland Italy with islands of Sardinia and Sicily would be upgraded and industrial consumers would get discounts on power supplies if they agree to be subject to temporary interruption of supplies.
While a move in the right direction, a spokesman for the Pittsburgh-based aluminum giant said the next step will be a ruling on the matter by the European Union.
"This is a decree for energy within Italy that is not specific to us, but would play into our situation there. There is a parallel path that is also ongoing that is part of an EU review," said Alcoa spokesman Kevin Lowery.
Alcoa agreed in late February to keep its Italian plants, which employ about 2,000 people, working for six months instead of idling them as planned after the EU ordered it to repay $300 million in state aid.
"We have already said we agreed to operate for a period of time while this review is taking place and that still stands. We knew that this review process was going on when we made that agreement. So, where it sits now is at the EU level," he said.
Alcoa, the government and other parties involved are expected to meet in April to evaluate the situation.
Alcoa argues that the penalty imposed by the EU Commission, currently under appeal, would have a "devastating impact," given the dramatic decline in aluminum prices amid the global recession.
Asked if Alcoa knew how long the EU's review process would take, Lowery said, "It's the EU's process and unfortunately we don't have a timetable."
The news drove Alcoa's stock up 85 cents, or 6.16 percent, to $14.65, on the New York Stock Exchange in afternoon trade. (Reporting by Svetlana Kovalyova. Additional reporting by Carole Vaporean in New York; Editing by Bernard Orr)

'Soaring costs are killing Vedanta Alumina'
Business Standard - March 18, 2010
Mukesh Kumar, chief operating officer of Vedanta Alumina (VAL), is a worried man. The company’s 1-million tonne refinery in Lanjigarh, which began operations in September 2007, is losing $90 on every tonne of alumina it produces, owing to high input costs.
Vedanta had set a target of producing 2.5 million tonne of aluminium by 2012-13, but the cost of operations at VAL, which will feed its Jharsuguda smelter in Orissa and Balco in Chhattisgarh, is high. The 500,000-tonne Jharsuguda smelter — production is just half that figure now — is to be ramped up to 1.75 million tonnes, while Balco, 51 per cent owned by Sterlite, a sister concern of Vedanta, is scheduled to add a 325,000-tonne smelter to its existing capacity of 245,000 tonne.
“The remaining production is expected to come from some de-bottlenecking and will make India the world’s fourth largest producer of aluminium,” says a company spokesman.
VAL has already sought permission to ramp up its capacity to a whopping 6-million tonne.
But, with every tonne of aluminium requiring two tonne of alumina, this seems an ambitious target for the London-based Vedanta Resources, the parent company. The problem is bauxite, the primary raw material for making alumina. In an interview to Business Standard, Kumar revealed that VAL had notched up losses of Rs 500 crore since it began operations in August 2007. “We are already losing heavily, about $90 on every tonne of aluminium we produce because we source bauxite from Chhattisgarh, Jharkhand, Madhya Pradesh, Andhra Pradesh, Gujarat and Maharashtra. Transport costs have trebled the cost of bauxite and this is killing us.”

While global prices for alumina were an average of $ 200 per tonne, VAL’s production costs have hovered around $290. The cost of another input, caustic soda, is another critical factor.

The public sector Nalco in neighbouring Damanjodi spends just $20 per tonne on caustic soda, while VAL’s costs are $60. “Orissa has the best quality bauxite in the world, and because of this, consumption of caustic soda (used to remove the silica) is much lower. This enables Nalco to be the lowest cost alumina producer in the world, whereas we have become uncompetitive,” complains Kumar.

There’s clearly a compelling reason for VAL to kick off mining but allegations that it has contravened the Forest (Conservation) Act, 1980, may hamper these plans. Although the report submitted last Friday by the Chief Conservator of Forests J K Tewari has exonerated the company by saying “there is no violation with respect to the 660.749 hectares (mining lease area) of forest land,” it found there had been violations in an additional 33.73 hectares where pillars for a conveyor belt and a road have been constructed illegally.

But, the Orissa government has come out strongly to Vedanta’s defence. While Raghunath Mohanty, Orissa minister of steel and mines, has been defending the mining project vigorously in the Legislative Assembly and outside, senior bureaucrats have been campaigning to get the project approved by the ministry of environment and forests (MoEF). B P Singh, special secretary with Orissa’s forest and environment department, is said to have written repeatedly to the MoEF that there were no violations by the company involved in the mining of Niyamgiri.

The mining operation in Niyamgiri is a joint venture of the state-owned Orissa Mining Corporation (OMC) and Sterlite, in compliance with a Supreme Court decision that said Vedanta could not undertake the mining directly. The two have set up the joint venture South West Orissa Bauxite Mining Pvt Ltd in which Sterlite holds 76 per cent. Under the terms of the agreement with OMC, the corporation has to supply 150 million tonnes of bauxite to VAL, of which only 73 million tonnes will come from Niyamgiri.
Where is the rest to come from? Kumar shrugs aside the question, saying that is a question for OMC. But, there are other, more troubling questions over VAL’s projected six-fold expansion. The most important is about water. Alumina plants are water guzzlers and even though VAL claims its “zero discharge” technology – it is reportedly the only such alumina refinery in the country – allows it to cut water consumption by as much as a third, the water requirements for a six-million tonne plant would be at the very least 50,000 cmd (cubic metres daily). As it is, about 14,000 cmd is being pumped out daily from the Tel River, about 66 km from the refinery.
Geologist R Sreedhar, who heads the Delhi-based Environics Trust that has been studying the Niyamgiri project points out: “There is grave concern about the implications of bauxite mining on the water situation. Orissa is a highly water-stressed state and if water from the Tel river in the drought-prone Balangir is being drained for the water-intensive aluminium industry we could face a dangerous situation.”

Bauxilum may import bauxite as water levels in Orinoco River fall

Metalbulletin.com (subscription) - 17 March 2010
Săo Paulo , Venezuelan state-owned bauxite and alumina producer CVG Bauxilum may import bauxite because it has not been able to transport its own raw material to its refinery due to low water levels in the Orinoco River. The company’s sole bauxite mine, Los Pijiguaos, is located some 500km away from its alumina plant in Puerto Ordaz and bauxite inventories stockpiled near the refinery will only last until the end of April, a union leader told MB. “If the water levels of the Orinoco River don’t increase over the next few weeks, the company will have...

Vimetco in Chinese JV
Business Financial News Wire - 17 March 2010
Dutch aluminium products company Vimetco says its Chinese subsidiary Henan Zhongfu has entered a joint venture with aluminium producer Chalco Henan Aluminium Fabrication.
The long-term goal is to focus on higher added-value products.
The new Henan Zhongfu Specialized Aluminum Product Co will have a registered capital of RMB769m, of which Chalco Henan will contribute cash representing 26%.
Henan Zhongfu will own 74%, comprising production facilities, inventories and other assets plus a RMB105m cash contribution.
Story provided by Business Financial Newswire

Emal's $5.7bn aluminium smelter project on schedule
Emirates Business 24/7 - 17 March 2010
Potline number one of Emirate's Aluminium (Emal) is 50 per cent complete in terms of construction, according to a senior official.
Meanwhile, three gas turbines out of six are now in operation to produce the power required for the smelter.
"We are looking at the operations of power stations of around 200 MW power by December this year," said its Project Director Yousuf Bastaki.
Emal is currently undertaking feasibility studies on the second phase of its plant and expects to take a decision this year.
The $5.7 billion (Dh20.9bn) project, located at Al Taweelha in Abu Dhabi, is a joint venture between Dubai Aluminium Company Limited (Dubal) and Mubadala Development Company – Abu Dhabi's investment vehicle.
In an interview with its project director, Reuters said yesterday Emal is currently producing 300 tonnes a day, and expects to hit its production target of 700,000 tonnes per year for phase one by December.
Emal is expected to be the world's largest single-site aluminium smelter complex with this project. The first phase of the project will have a capacity of 2,000 MW of electricity.
The second phase of the plant, which will increase capacity to 1.4 million tonnes of aluminium annually is expected to be completed by 2013-2014, the company's Chief Executive Officer Saeed Al Mazroui said in January.
"They are currently conducting the feasibility study," said Emal's Vice-Chairman Abdulla Kalban.
Emal signed a contract this month to ship aluminium to South Korea's Daewoo International Corporation.

Six GCC smelter companies join forces to form GAC
GulfNews - March 17, 2010
Six manufacturers have teamed up to launch the Gulf Aluminium Council
By Nadia Saleem, Staff Reporter
Dubai: Six GCC smelter companies have joined to form the Gulf Aluminium Council (GAC) to increase competitiveness and efficiency.
The announcement was made Tuesday in Dubai during the Middle East Aluminium conference organised by MEED.
The council will oversee three million tonnes of aluminium production by its members by the end of this year.
Five established smelters will be represented by the council: Aluminium Bahrain (Alba), Dubai Aluminium Company (Dubal), Emirates Aluminium, Qatar Aluminium and Sohar Aluminium in Oman. The sixth member is Saudi Mining Company, which has announced plans to develop a fully integrated complex in Saudi Arabia scheduled for completion in 2013.
The smelters at Alba, Dubal and Sohar together produced more than two million metric tonnes of primary aluminium in 2009 and 5.6 per cent of the global market.
The smelters will have equal voting rights on the council's board, officials said.
"The overriding objectives of the council will be to support the successful growth of the primary aluminium industry in the GCC," Abdullah Kalban, president and chief executive of Dubal and board-elected chairman of GAC, told reporters in Dubai yesterday.
"Through the council, the members will continually explore opportunities for synergy between our operations, such as logistics and transportation, that will further improve our international competitiveness," he said.
GAC will also serve as a coordinated voice for the aluminium industry in the Gulf, acting as a representative body for its members.
This year, the Middle East will recover to pre-crisis aluminium demand levels of 2008, according to Marco Georgiou, head of Aluminium Primary and Products, CRU Analysis, a research firm that covers mining, metals, power and cable sectors.
This year's consumption will grow by over 12 per cent on a global scale, with most of the demand coming from the Middle East, China and India.
Industry Forecast
World production will hit 41 million tonnes, and consumption will be 38 million tonnes, Georgiou predicted at an aluminium conference in Dubai yesterday.
He said that this year and next, China, the Middle East and India will account for 97 per cent of 7.9 million tonnes per year of global capacity increases and lead the growth for aluminium in the next 12 to 12 years.
The Arab region currently enjoys a global cost advantage and the top priority for regional aluminium smelters will be to maintain their "very attractive position on the cost curve for future growth," Georgiou said.

Bauxite Resources Selects Aconex for Alumina Refinery Project
FOXBusiness -Mar 16, 2010
Aconex has been selected by Bauxite Resources Limited (BRL) to provide its online project collaboration (http://www.aconex.com/) system to the Darling Range bankable feasibility study in Western Australia. Aconex will be used to manage the large volume of information generated on the project and link the organizations involved.
The study will determine the viability of a proposed new alumina refinery, which would generate 800,000 tonnes of alumina annually. Pending the outcome of the study, these new facilities will also require new and upgraded infrastructure and will be delivered through a joint venture with the Yankuang Group, one of China's largest state-owned mining enterprises.
Aconex will provide all parties engaged in the project - including business partners, consultants and stakeholders - with a central, web-based system for managing project information such as documents and correspondence. By using the system, parties will be able to access, distribute, track and archive their data in real time using a single, common platform.
Phil Hodgson, Business Improvement and Systems Administrator at Bauxite Resources Limited, said: "For project delivery, BRL will be collaborating with many external contractors, governmental and non-governmental agencies. Because of this, we recognized the need to have an appropriate document management system that is centralized, easy to use and provides project controls, including tracking capabilities.
"In conjunction, BRL is implementing a Project Delivery Framework for project governance and recognizes the importance for a document management system that facilitates this process - making it easy for all project participants to understand what is expected of them and enabling them to comply."
Hodgson added, "We selected Aconex largely because of the positive experience that many stakeholders and external participants have already had with the system. A key aspect for us is that project teams will be able to easily locate information and readily understand the progress of projects. They are also able to observe and report any deviation from the plan during all the stages of our projects."
Aconex, www.aconex.com, is the world's largest provider of project collaboration solutions to the construction and engineering industries. From its 35 offices worldwide, the company services $220 billion worth of projects across 65 countries.
BRL is the largest tenement holder in the Darling Range with approximately 22,000 square kilometers of prospective bauxite available.

Vedanta Hits Snag in Efforts to Mine East India Hills
Wall Street Journal - Mar 16, 2010
NEW DELHI: The plan by London-based Vedanta Resources to mine bauxite in Orissa—a key part of a giant aluminium complex which the company is building in the mineral-rich eastern state could be jeopardised if the environment ministry accepts the findings of a report by a government-appointed committee.
Environment minister Jairam Ramesh says the report will be sent to the ministry of tribal affairs for its inputs. Mr Ramesh says he is neither for nor against the project sought to be implemented by Vedanta, owned by tycoon Anil Agarwal, and would be guided entirely by the report and the facts on the ground.
But officials at the ministry of environment & forests (MoEF) told ET that the government is deeply concerned about some of its findings, which has among other things pointed out that Vedanta’s mining activities in Niyamgiri in Orissa would have an adverse impact on the local Dongria Kondh tribe, which is classified as a primitive tribal group. The government, or at least the environment ministry, appears unconvinced by a strong letter of support sent to it by the Orissa government last Thursday supporting the project and asking for a final clearance.
Any final licence to mine—if there is to be one—will now hinge on three factors . One is Vedanta’s response to a showcause notice issued to it by the environment ministry asking it to respond to allegations that it had started work on the mining project without receiving all clearances.
More importantly, the response the environment ministry receives from the ministry of tribal affairs may decide the fate of the mining project. The tribal affairs ministry has been asked to figure out whether the Forest Rights Act, a law enacted by Parliament giving India’s tribal communities certain rights over the forests where they traditionally reside , has been properly implemented in that part of Orissa. Thirdly, the impact of the project on the Dongria Kondhs will be closely studied.
One person familiar with the matter said the Vedanta issue has also become embroiled in politics with the Congress Party not seemingly in favour of the project. A top official in the environment ministry told ET on condition of anonymity that the government is alarmed about the complaints received against the mining company. “There cannot be smoke without fire. We are hearing about human rights abuses to a degree that is shocking,” said the official.
Mr Ramesh’s move to rope in the ministry in charge of tribal welfare is in line with the views of the forest advisory committee that compiled the report on Vedanta and is the nodal agency for all forest clearances. The report suggests that the issue of whether the implementation of the Forest Right’s Act has been completed be referred to the tribal affairs ministry. Vedanta has denied any wrongdoing. In an emailed response to ET, a company spokesperson said that the views expressed in the fact finding report are “biased” and “should not be considered” because one of the committee members has had a past association with Amnesty, the NGO that has been opposing the company’s project.
A three-member committee, comprising Usha Ramanathan, an independent law researcher, Vinod Rishi, additional director general (wildlife) at Dehradun’s Wildlife Institute of India, and JK Tewari, chief conservator of forests, MoEF (Bhubaneshwar), had submitted their report to the FAC last Friday. This report contradicts the claims of the district collectors of the two affected districts, Kalahandi and Rayagada, that the implementation of the FRA (Forest Rights Act) has been completed. The report says: “Until these, and allied rights are recognised, recorded and settled under the FRA, it would be unconstitutional and in breach of the FRA, to disturb (the tribals’ ) habitat.”
The report has also highlighted the adverse impacts the project will have on the Dongria Kondhs saying that the community is not ready for an ecological shift, and that any “disruption of the habitat and the way of life of this PTG (Primitive Tribal Group) cannot be remediated nor compensated, and may lead to the destruction of the Dongria Kondh as a PTG.” The report also finds merit in villagers’ complaints about pollution from the plant.
ET had reported on Monday that Vedanta is planning to list its Orissa aluminium project. But the large part of the value for potential investors is the reduction in cost which would endangered if the company sourced bauxite from Niyamgiri in Orissa rather than outside, which is currently the case. Given the negative tone of the report, an early clearance looks extremely unlikely . The report has brought the project’s possible impact on the local tribals to the centrestage. The rest of the report, on whether the company began construction in non-forest areas before it got a sister clearance for forest areas (under the Forest Conservation Act, construction can begin only once both clearances are given), and the project’s impact on wildlife, is more non-committal .

Rio Tinto, Chinalco in Talks on Guinea Mine
TheStreet.com (subscription) - 16-Mar-2010
NEW YORK (TheStreet) -- Rio Tinto(RTP) and Aluminum Corp. of China(ACH) are in advanced talks to jointly develop the Simandou iron-ore project in the West African nation of Guinea, the Wall Street Journal reports, citing a person familiar with the matter.
Rio's agreement with the Chinese company Aluminum Corporation of China Ltd , also known as Chinalco, could offset some of the cost of the projected $6 billion Guinea mine project, the Journal says. Rio Tinto is spending about $10 million a month to develop and explore the mine with the goal of selling the ore commercially, the newspaper says.
Rio Tinto last year walked away from a proposed $19.5 billion deal with Chinalco that would have give the Chinese company an 18% stake in Rio Tinto. To pay down debt, Rio Tinto instead held a rights issue and formed an iron-ore joint venture with fellow miner BHP Billiton(BHP).
Written by Joseph Woelfel in New York.

Middle East aluminium output set to increase
SteelGuru - Tuesday, 16 Mar 2010
According to industry experts, the Middle East could be producing more than 10% of the world's aluminium in less than a decade.
Over the past 10 years, GCC states have begun implementing long term strategies that aim to develop the region's aluminium industry and the region is now well positioned to be one of the world's main aluminium producers. In 2000, the GCC share of global aluminium production was 1.8 million tonnes per annum.
By 2008, this figure had risen to 2.2 million tonnes per annum representing 5.4% of global production and it is expected to continue to increase to 6 million tonnes per annum in 2015 and to 9 million tonnes per annum in 2020 to reach 13% of global production.
As the price of aluminium continues its quick recovery from the impact of the global crisis, MEED, the Middle East business intelligence provider, is preparing to host the Fourth Middle East Aluminium Conference.
Entitled 'Building a Sustainable Downstream Industry', the conference, which will take place at the Dubai Marina Address Hotel on March 16th to 17th provides a comprehensive overview of the Mena aluminium production and processing sector and its place in the global market with focus on building a sustainable downstream sector for the region's industry.
Mr Edmund O'Sullivan chairman of MEED Events said that "There are huge opportunities for investments in the region to capitalize on the production of primary metal by the region's major smelters. This year's event is bigger than ever, with dedicated streams for the upstream production and smelter side of the industry and for the downstream processing and fabrication sector.
He said that the Middle East Aluminium 2010 Conference presents an ideal opportunity for the local aluminium sector to forge strategic partnerships and alliances with international and regional partners that will help them expand and keep the Middle East at the cutting edge of aluminium sector growth. (Sourced from www.gulfbase.com)

Bauxite output at Bauxilum Los Pijiguaos down 60pct - Union
SteelGuru - Tuesday, 16 Mar 2010
BNAmericas quoted a Sintrabauxilum union leader as saying that Bauxite production at the Los Pijiguaos mine that belongs to Venezuelan state alumina producer Bauxilum fell by 60% in January.
The union official said that under normal conditions the mine produces 16,000 tonne per day to 17,000 tonnes per day but current output is around 6,000 tonne per day to 7,000 tonne per day.
The union representative said that there are no spare parts and only one machine is actually operating, creating a threat to the entire aluminum production chain. Bauxilum, which normally produces around 6 million tonne per year of bauxite, has not set any production goals for the year.
Infrastructure for mining and processing Los Pijiguaos' bauxite includes a crushing mill, 4.5 kilometers conveyor belt, 52 kilometers railroad and a control center. Bauxilum also operates 2 million tonnes per year alumina plant in Guayana region's Puerto Ordaz city.
(Sourced from Business News Americas

Rio Tinto: China is key to growth
International Business Times Australia - Tuesday, 16 Mar 2010
Global Miner Rio Tinto zeroes in on building a stronger tie with China this 2010. This is their focus even after last year's controversy with the company's biggest partner.
Rio Tinto: China is key to growth Seven's share trading halted after info leaked Canberra to Beijing: Hands off ore price negotiations LNG Halt A Precursor to Arrow Action? Coporates: Macarthur, Molopo
As the 2009 annual report for miners came out today, Tom Albanese, Rio Tinto's chief executive expressed their focus on China as the country is their top customer for short-term demand.
"It is also the home of our largest shareholder, Chinalco," Albanese said.
The partnership with China was not always good. Jan du Plesis, chairman, explained that they looked into the partnership well.
"After the particularly difficult first few months, characterised by our balance sheet challenges, very weak demand, low product pricing and the contentious Chinalco transaction, our fortunes improved considerably as the year progressed," Mr. du Plesis said in the report.
"The key driver for the mining industry continues to be demand from China," he expounded.
The report today also presented the Rio Tinto's remuneration for the company's executives. It shows a boost on the total number of remuneration due to short-term incentives. Albanese, for example, had a total remuneration of $3.8 million. Guy Elliot, chief financial officer, received $2.4million. Retiree Dick Evans, former aluminum chief for the company, received an approximate amount of $10.09 million. Iron ore chief Saw Walsh had $5.59 million for remuneration.
This report shows how Rio Tinto is rising above the occassion and that it may just be ready for a better partnership with China.

Rio Tinto and Chinalco in Talks Over Guinea Mine
Wall Street Journal - Tuesday, 16 Mar 2010
By JEFFREY SPARSHOTT And ROBERT GUY MATTHEWS
Rio Tinto and Aluminum Corp. of China Ltd. are in advanced talks to jointly develop the Simandou iron-ore project in the West African nation of Guinea, according to a person familiar with the matter.
An agreement with the Chinese company, known as Chinalco, could offset some of the continuing cost of the projected $6 billion Guinea mine project. Anglo-Australian Rio Tinto is spending about $10 million a month to develop and explore the mine in anticipation of selling the ore commercially.
The talks apparently are looking toward an exchange of intelligence on how to develop mining projects in Guinea, one of the most mineral- and metal-rich countries in Africa, rather than Chinalco selling iron ore, although that could be a future option. The negotiations are also looking at whether Chinalco money could be invested in offsetting future development costs of the mine.
The negotiations regarding the Guinea project were previously reported in the Sydney Morning Herald. A Rio Tinto spokesman declined to comment on the report.
Tom Albanese, Rio Tinto's chief executive, said earlier this year that he wanted to strengthen ties between his company and China, despite that country's detention of four Rio Tinto executives on charges of corporate spying.
Rio Tinto has had trouble trying to develop the big Guinea mine. It is fighting a government ruling that stripped it of the northern section of land the company hoped to mine for iron ore, giving it to another miner, BSG Resources, owned by Israeli billionaire Beny Steinmetz. So far, Rio Tinto has been unsuccessful, but it hopes the current government will overturn the previous government's ruling against the company.
Chairman Jan du Plessis, in the company's annual report Monday, said Rio Tinto would work to extend its relationship with Chinalco "and to pursue business opportunities that may be to our mutual benefit."
Last year Rio Tinto walked away from a $19.5 billion alliance with Chinalco, its biggest shareholder, in favor of a rights issue and an iron-ore joint venture with fellow Anglo-Australian BHP Billiton to pay down debt. The move strained relations with Chinalco and the Chinese government.

Aluworks to raise 30 million Ghana Cedis in rights offer
Ghana News - Accra, March 15, GNA -
Aluworks Limited, manufacturers of cold-rolled aluminum products, is to raise GH˘30 million ($20 million) in a rights issue to be utilised partly to complete a planned capital expansion and to provide working capital to support increased level of business. The company will use $10 million to acquire and install a second cold mill to boost capacity from the current level of 30,000 tonnes to 50,000 tonnes, to meet both local and export demand.
Aluworks expects the second cold mill to be in place by the end of 2011 while current cold mill is retired for refurbishment in 2012 The remaining $10 million will be used as working capital to implement the company's strategy for raw materials.
"The right issue would address the high interest cost the company currently pays to the banks and strengthen the company's capacity to adequately meet demand for flat rolled aluminum products in the region," Mr. Ernest Kwasi Okoh, Managing Director of the Company, said that after the launch of the offer, which runs from March 15 to April 9, 2010. Current shareholders are allowed nine shares for every five existing shares at a discount of nearly 10 per cent of the market price. "A lot of our export already goes into Nigeria and we expect that to grow tremendously over the next few years," Board Chairman of the Company= , Mr. William Inkumsah said.
He said funds from the offer would also help deal with the disruption in supply of aluminum ingots from the traditional local supplier, Volta Aluminum Company (VALCO), which has led to a 33 per cent increase in importing costs after frequent interruption in power supply affected production. Mr. Inkumsah urged shareholders to take advantage of the offer to increase production as demand for aluminum was growing strongly after the global credit crunch.
The company now source raw material from UC Rusal Marketing GMBH, whose supplies come from either Alscon in Nigeria or St. Petersburg in Russia; BHP Billiton Marketing AG, whose supplies come from South Africa, and Bharat Aluminum Co. Ltd. of India. 15 March 10

Vedanta may spin off aluminium project
Economic Times - 14 Mar 2010
MUMBAI: Vedanta Resources — the mining major owned by London-based tycoon Anil Agarwal — is likely to demerge a large aluminium project in Orissa into a separate entity to help the conglomerate get a better valuation for the aluminium business.
London-listed Vedanta has hired Morgan Stanley, Credit Suisse and JP Morgan Cazenove to put together a plan that would result — if approved by shareholders and creditors — in Vedanta Aluminium, the subsidiary which has operations in Orissa, being listed on NSE and BSE. Bharat Aluminium, or Balco, another aluminium company in the Vedanta fold, is not part of this plan, since the government owns 49% of it, said people familiar with the development. This is the second major corporate restructuring proposal that Vedanta has planned in two years. It had to go back on the earlier proposal — a complicated plan which proposed the unbundling of its aluminium, zinc, copper and mining businesses — due to the liquidity crisis and opposition from institutional shareholders. Vedanta Resources declined to comment for this story.
The people familiar with the matter said Vedanta wanted to make its Indian business — which are currently consolidated under Sterlite Industries which directly makes copper and holds stakes in companies smelting aluminium and zinc — easier for investors to understand. If the plan is approved by shareholders and regulators, Sterlite will end up as primarily a maker of copper, zinc and lead while the bulk of the aluminium business will be with the new listed company, Vedanta Aluminium.
Both entities, Sterlite and Vedanta Aluminium, will be majority owned by the London-based parent, Vedanta Resources.
Vedanta Aluminium is 70% owned by Vedanta Resources and the rest is with Sterlite Industries.
The details of the listing plan are not available, but logically there are three ways in which Vedanta Aluminium can be listed. The company could list through an initial public offer, or IPO, in which new shares would be issued, or the owners could divest their stake. The third option is to issue new shares to existing shareholders of Sterlite on a proportionate basis by valuing the contribution of the aluminium business. Shareholders, other than the owners, have to own 10% in all listed Indian companies, and that number will go up to 25% in the new fiscal starting April 1.
Apart from shareholder approval, the demerger proposal would also require clearance from a high court, which could take about three months.
The demerger proposal comes at a time when Vedanta Aluminium’s mining project in Niyamgiri in Orissa has come under regulatory glare for alleged environmental and human rights transgressions with organisations, such as the UK-based Amnesty International and Survival, alleging that the company hasn’t involved the local populace in the project, despite the fact that the project could displace them.
This narrative — popular among sections of non-governmental organisations, or NGOs, — has been strongly denied by both Vedanta and the Orissa government. Both say that the mining project, currently undertaken jointly by Vedanta and the state government-owned Orissa Mining Corporation, has not violated any Act.
The demerger proposal for Vedanta Aluminium doesn’t include Bharat Aluminium, or Balco, as the Indian government owns 49% in it. Sterlite acquired a 51% stake in Balco through a divestment programme in 2001. Any consolidation of Balco into the new aluminium business would happen only if the government sells its stake. Sterlite and the government have so far not been able to agree on a price.
While Balco makes about 350,000 tonne of aluminium at its smelter in Korba, Vedanta Aluminium plans to put together an integrated aluminium operation in Orissa which would consist of a 1.75-million-tonne aluminium smelter at Jharsuguda, 5-million-tonne alumina refinery that will convert the bauxite proposed to be mined at Niyamgiri into alumina and a captive power plant of 1,215 megawatts, as the entire conversion process is done through electricity.
On completion, Vedanta Aluminium, along with Balco, will catapult the Vedanta Group into the world’s fourth-largest aluminium player, behind Rusal of Russia, Alcoa of US and Chalco of China.
The valuations for Vedanta Aluminium, once the Orissa project is complete, could touch $20 billion, based on the low cost of production, said analysts. Currently, since Vedanta Aluminium buys alumina — the main raw material for making aluminium — from outside, its cost of production is $1,400 per tonne, which could fall to about $1,000 per tonne, once the Niyamgiri mining project takes off.
Globally, the lowest cost of production — at $1,300 per tonne — is that of China’s Chalco.
But it is far from clear if Vedanta will get a mining licence in Niyamgiri anytime in the near future or ever. On Friday, the government’s forest advisory committee, or FAC, submitted a lengthy report on the Vedanta project.
While the project found no major violations of environmental norms, it said the local tribal population, which is classified as a ‘primitive tribal group’, were in no position to benefit from the project. Further, the report calls for the proper implementation of a central Act — called the Forest Produce Act — in Niyamgiri. The environment ministry is likely to refer this to the tribal affairs ministry.

China clears Rio, Australia for failed Chinalco bid
China Economic Review - March 15, 2010
A report by China's State Council clearing the Australian government and Australian miner Rio Tinto (RIO.ASX, RIO.LSE, RTP.NYSE) of blame for the failure of Aluminum Corporation of China's (Chinalco, 601600.SH) failed bid for a US$19.5 billion tie-up last June was welcomed by Australian authorities, Reuters reported. According to a report in Australian newspaper The Age, the State Council blamed economic forces and a public relations campaign lobbying against the deal by Rio competitor BHP Billiton (BHP.ASX, BLT.LSE, BHP.NYSE) for the failure of the deal. Following the failure of the Chinalco bid, Rio went on to contract with BHP Billiton on an iron ore joint venture. The Beijing subsequently had four Rio negotiators arrested on allegations of spying and bribery. The Australian government said the report should help heal Sino-Australian relations.

NALCO projects full utilisation of its smelter, refinery
Daily News & Analysis - Friday, March 12, 2010
Bhubaneswar: NALCO has signed a Memorandum of Understanding with the ministry of mines for 2010-11 projecting 100% capacity utilisation of its aluminium smelter to produce 4.6 lakh tonne of metal and 16.58 lakh tonne of alumina from the refinery.
The MoU signed yesterday also projected production of 7715 million unit of power at 85% of PLF (plant load factor) from its 1200 MW captive power plant at Angul.
The Navratna company has also projected higher financial targets and early completion of its on-going second phase expansion projects, a NALCO release said.
NALCO has agreed to focus on completion of targets of UtkalE coal block for coal production by June 2012, Aluminium Park in Angul in joint venture with the state government of Orissa, greenfield smelter abroad and development of recently allotted bauxite deposits in Andhra Pradesh for setting up a mines and alumina project at a cost of Rs.6000 crore.
For the first time special weightage has been given to sustainable development which includes tree plantation and wind farm development.
Special imphasis has also been laid on Corporate Social Responsibility (CSR) with focus on SA8000, health camps in periphery villages and enhanced allocation for peripheral development activities, the release said.
The MoU was signed between AK Srivastava, CMD, NALCO and Union mines secretary Santha Sheela Nair.

Gas shortage hits Sohar Aluminium's expansion
Peninsula On-line - 3/12/2010
Source: Reuters
DUBAI: Oman’s Sohar Aluminium, part-owned by a unit of global miner Rio Tinto, sees gas shortages as the main obstacle to further expansion, a top executive said.
Sohar Aluminium, a $2.4bn joint venture located in Oman’s Sohar industrial port, completed the first phase of the project in February last year and is operating at full capacity of 360,000 tonnes per year (tpy).
The company had plans for a second phase which would add another 360,000tpy but the project had been put on hold due to limited gas supplies, Sohar Aluminium Chief Executive, Bruce Hall said in a telephone interview.
“We aspire to build phase two, but there is no formal time frame and the main reason is current gas availability,” he said.
The non-Opec oil exporter needs to increase gas supplies by 48 percent to 7.2 billion cubic metres a year by 2013 to fuel power and desalination plants, the Oman Power & Water Procurement Company said in 2008.
Gas demand is 13.6 million cubic metres per day (cmpd) and will increase to 20 million cmpd by 2015, it added.
Government test drilling in the gulf state has yielded positive results for oil and gas, said Hall, but “we still don’t know how much of these reserves are available, and if they are available.”
“It’s still not a slam dunk because we will be competing with other companies that produce methanol, urea and LNG who also need gas.”
Importing gas though the United Arab Emirate’s (UAE) Dolphin Energy pipeline which pumps gas from Qatar could be an option for Sohar, however the additional costs must be considered, said Hall.

Ormet Releases Financial Results
MarketWatch (press release) - 11-Mar-2008
Net cash used in investing activities was $10.1 million and was directly related to the relining of certain "pots" at the
aluminum smelter in Ohio totaling ...

Goa Carbon to Finalize China Partner
Wall Street Journal - Mar 10, 2010
By SAHIL MAHTANI
MUMBAI -- India's Goa Carbon Ltd. has short listed two companies for building a joint-venture plant to produce calcined petroleum coke in China and expects to finalize an agreement by the middle of April, its chairman said.

The company is looking to start building the facility in the first half of the next fiscal year starting April 1, Shrinivas Dempo told Dow Jones Newswires in a recent interview.

The plant is expected to cost two billion rupees ($44 million) and its first phase will have a capacity of 250,000 tons a year, he added.

Calcined petroleum coke, or CPC, is a key raw material in the aluminium smelting industry. Demand for aluminum is growing at a fast clip in China because of demand from that country's energy and automobile sectors.

Goa Carbon currently sources about 60% of raw petroleum coke, used for producing CPC, from China. A calcination facility there would help the company to be closer to suppliers and get customers in the Chinese market.

It now has three facilities, all in India, with a total capacity of 240,000 tons a year.

"In terms of raw-material availability, China is the place to be," Mr. Dempo said.

Besides supplying to Chinese companies, the plant is expected to export CPC to Australia and the U.S., he said.

Mr. Dempo said of the two billion rupees required for the plant, one billion rupees will be raised as debt by the Chinese company that would partner in the facility, while the rest will be equity from the joint venture's two partners.

Goa Carbon will raise funds for its share of equity through a rights issue, Mr. Dempo said, without indicating when the issue will be floated.

Write to Sahil Mahtani at sahil.mahtani@dowjones.com

Century Aluminum may restart Ravenswood plant
Metals Place 11-Mar-2010
A bill that passed the West Virginia legislature could offer a glimmer of hope to Century Aluminum. The plant closed last February leaving more than 600 people without a job.
Mike Dildine, a spokesperson for Century Aluminum, says the bill is a huge first step.
"The passage of the industrial power bill was a huge step forward," Dildine says. "Because it provides for us a mechanism to design an affordable power rate which is something we absolutely need if we are going to restart the smelter."
The House unanimously passed a Senate measure Tuesday that proposes linking utility rates to changes in the market prices for the goods made by qualifying businesses.
The bill would allow companies to pay more for power when their commodity is at a high price, and a lower rate when the commodity price is down.
These employers could negotiate special rate deals with power companies. If rate talks fail, the employer could petition regulators at the state's Public Service Commission for the special rate.
Appalachian Power has said Century Aluminum spent more than $100-million each year on power. When the plant closed, the cost of electricity was a major factor. Aluminium prices dropped significantly making it difficult to cover the costs.
"They'll be able to ride out these market fluctuations," Delegate Mitch Carmichael, a Republican from Jackson County says.
While Dildine says, "the sooner we can open the smelter, the better," this bill is just one piece of the puzzle.
Dildine says to re-start the smelter three things have to happen. They need a competitive long-term power contract, a contemporary labor agreement and they also need the expectation that aluminium prices will stay above the cost of the production.

Novelis exec sees aluminum demand rising, but not here
Purchasing.com - Tom Stundza - 3/10/2010
Asian buyers will lead the global pickup in purchasing
Global demand for aluminum should increase by an annual average of 4% over the next five years, forecasts Philip Martens, president of Novelis Inc. in Atlanta, the U.S.-based aluminum unit of India's Hindalco Industries Ltd.
The strongest growth, of about 6% to 10% annually, will come from Asia, followed by 7% to 8% increases in South America, Martens tells Bloomberg in a telephone interview. North American demand may increase 1% to 3% annually, followed by Europe, which will see gains of 1% or less. The local forecast fits with latest buyer surveys by Purchasing, which show les than 10% are planning to boost purchases anytime soon. And that will keep North America smelting below 13,000 metric tons/month for some time, analysts suggest.
"We're beginning to see an increase in demand (from) makers of electronic consumer durables, with demand primarily coming out of Asia," Martens says. He points to solid purchasing from Asian makers of flat-screen televisions, laptop computers, gaming stations, cellular telephones and cameras.
Regional North American demand for sheet, plate and extrusions remains "mainly flat," according to Martens, commenting on data from the Aluminum Association, which shows that January's new-orders index of 78.2 was below the 2009 average of 79.3.
Meanwhile, Novelis' five-year non-compete agreement for the aerospace sector signed as part of its 2005 spin-off from what was Alcan of Canada (now Rio Tinto Alcan) has expired, but that doesn't mean the aluminum rolled products manufacturer is ready to produce aerospace material just yet.
Analysts in the aluminum sector tell metals newspaper AMM.com that aerospace could be a natural fit for the sheet and plate supplier, but cite some major hurdles. The first is low smelting and aviation-grade aluminum capacity utilization rate. Aircraft plate capacity utilization was just 48% last year, according to research by Davenport & Co., which estimates that deliveries of large commercial aircraft are expected to decline around 3.5% to 940 this year from 974 in 2009 with only a "modest rebound" likely to occur starting in 2011.And, in early 2010, aerospace "isn't a terribly good market at the moment," says analyst Charles Bradford at Affiliated Research Group. "Incoming orders are very few and far between."

Icelandic energy pays price for aluminium profits
IceNews - 3/10/2010
Nordural (Century Aluminium) pays a quarter less for its electricity in Iceland than the global average. This was revealed in a confidential leaked document to RUV.
It is the energy companies who carry the most risk when global aluminium prices fall.
The document is from Hatch consultants and is compiled on behalf of foreign banks and Nordural. It is stamped ‘confidential’ and covers actual figures on production costs, including energy prices. At the time of writing Nordural was paying 15 mill per kilowatt hour. A mill is one thousandth of a dollar, meaning 15 mill is 1.5 US cents, or 2 Icelandic kronur. Icelandic homes pay roughly 10 kronur per kilowatt hour, and British homes pay up to ISK 42 for comparison.
The electricity cost is connected to the market value of aluminium, which was USD 1,400 per tonne at the time of writing. If the aluminium price increases by USD 1,500 then the price of electricity supplied increases by 15 mill.
The price of aluminium has been roughly USD 1,500 per tonne for the last decade, but prices fluctuate rapidly and most experts predict a slight fall in average prices over the next decade. The document clearly states that Nordural is paying a quarter less for its electricity in Iceland than is average around the world.
Although the document relates to only one Icelandic aluminium smelter, Dr. Sigurdur Johannesson at Statistics Iceland believes heavy industry generally pays the same amount.
The suspected low electric price and the danger to Icelandic energy companies from changes in aluminium prices have been raising eyebrows for some time. And at least one financial advice website encourages investors to buy shares in Nordural’s mother company because of Iceland’s low and stable electricity prices.
Roughly a third of the sale price of aluminium runs to Nordural in pre-tax profit – providing the company with a three-time better deal than Icelandic energy company Landsvirkjun gets for its investment.

China's Hanzhou Jinjiang mulls 1-mln T aluminium smelter
Reuters India - 09-Mar-2010
* China Jinjiang Group aims to build aluminium smelter
* Eyeing one million tonnes of capacity in Inner Mongolia
* Smelter investment could exceed $1.46 billion
By Polly Yam
HONG KONG, March 9 (Reuters) - China's Hanzhou Jinjiang Group is considering building a one million-tonne-a-year primary aluminium smelter in Inner Mongolia to exploit rich energy resources there, a company official said on Tuesday.
The group aims to build the smelter in Huolinguole city, home of coal producers and aluminium producer HMHJ Aluminium Electricity Co, a unit of China Power Investment Corp.
"Our biggest considerations are: approval, resource (power) supply and funding," the official, in the group's administration department, told Reuters, estimating total investment for the smelter at more than 10 billion yuan ($1.46 billion).
While it weighs the feasibility of building a smelter, the group is concerned about the domestic market, the world's biggest but which may be nearly saturated with aluminium capacity, he added, but gave no timeframe for the investment plan.
An investment official of the Huolinguole government said the two parties had discussed the project but had not yet finalized the investment plan.
But securing central government approval may be a struggle as Beijing looks to close 800,000 tonnes of old smelting capacity by the end of 2010, and has vowed not to approve any new smelters in the 2009 to 2011 period, in principle, as China already has plenty of excess capacity.
If built, the smelter would be Hanzhou Jinjiang's first primary aluminium plant in China after having dropped a few smelting projects in the Chinese provinces of Guangxi and Ningxia in the past several years for lack of resources, the administrative official said.
The group, with interests spanning petrochemicals and hotels, owns a 1.8 million-tonne-a-year alumina refinery, Cayman Aluminium in Henan, which would provide the alumina for the smelter in Huolinguole.
Each tonne of aluminium made in China, the world's top producer and consumer of the metal, takes two tonnes of alumina.
China will consume 15.9 million tonnes of the metal this year, up 15 percent on the year but output would rise a faster 24.7 percent to 17 million tonnes due to expanded capacity, state research group Antaike has predicted.

S.Africa looks at reinstating aluminimim import duties
Reuters South Africa - 09-Mar-2010
Tue Mar 9, 2010 10:28am GMT Print | Single Page[-] Text [+] CAPE TOWN (Reuters) - South Africa would consider reinstating import duties for aluminium on economic grounds, but industry would need to apply formally for the measure, Trade and Industry Minister Rob Davies said on Tuesday.

Davies met in September with the Aluminium Federation of Southern Africa and Hulamin Ltd, Africa's biggest maker of semi-fabricated aluminium. The meeting discussed the adverse effects of removing import duties on downstream products, such as aluminium rolled products.

The decision to remove import duties was taken by the government-aligned International Trade and Administration Commission (ITAC), the minister said.

"Taking into account the depressed economic conditions, as well as the phased closure of the cast house at Bayside smelter, it was agreed that there may well be economic grounds to reconsider the decision and therefore reinstate the import duty," Davies said in a written response to questions in parliament.

Bayside aluminium plant, owned by BHP Billiton, has been operating well below its production capacity due to power shortages in Africa's largest economy. The global financial crisis also impacted production as demand decreased.

Davies said the aluminium industry was advised to meet with ITAC and make a formal application to reinstate import duties.

"Subsequently, ITAC has met with the industry and agreed to consider an application. However, to date, ITAC has not received a formal application from the aluminium industry as agreed," Davies said.

Hindalco's Novelis Sees Aluminum Demand Rising
BusinessWeek - March 9 (Bloomberg)
By Edmond Lococo
Novelis Inc., the U.S.-based aluminum unit of India’s Hindalco Industries Ltd., sees global demand for the industrial metal rising about 4 percent annually in the next five years, President Philip Martens said.
The strongest growth, of about 6 percent to 10 percent annually, will come from Asia, followed by 7 percent to 8 percent increases in South America, Martens said yesterday in a telephone interview. North American demand may increase 1 percent to 3 percent annually, followed by Europe, which will see gains of 1 percent or less, he said.
“We’re beginning to see an increase in demand in what we call industrial products, it’s really electronic consumer durables,” Martens, 49, said in an interview from Novelis headquarters in Atlanta. “Anything that requires an aluminum carrier for stability, light weight and other factors, we do see demand primarily coming out of Asia. Most of the products are produced there and shipped worldwide.”
Novelis is seeing the strongest demand growth for metal used in products such as flat-screen televisions, laptop computers, gaming stations, cell phones and cameras, Martens said. Aluminum for delivery in three months has increased 72 percent in the past year to $2,231 a ton on the London Metal Exchange, driven by demand from China.
Hindalco, India’s largest aluminum maker, acquired Novelis in 2007 for $6 billion, two years after it was spun off by Canada’s Alcan Inc. in 2005. Novelis had $10.2 billion in sales last year, 52 percent of which came from sales of aluminum used for beverage cans. Novelis has 12,000 employees in 11 countries.
The growth in global aluminum demand should be adequate to absorb the large inventories monitored by the LME without depressing prices, Martens said. Aluminum inventory now monitored by the exchange is 4.54 million tons.
“There is still quite a bit of inventory there,” Martens said. “I think the people who own the inventory are going to be smart and will meter it out over time as demand starts to pick up. Nobody is going to rush to dump inventory on the market.”

RUSAL eyes major Chinese aluminum deals
Reuters India - )8-Mar-2010
By Robin Paxton and Carolyn Cohn
MOSCOW/LONDON (Reuters) - UC RUSAL (0486.HK: Quote, Profile, Research), the world's largest aluminum producer, plans to secure between five and eight major Chinese buyers on long-term contracts to carve a larger share of the world's biggest market for the metal.
UC RUSAL, fresh from Russia's biggest-ever private sector debt restructuring, also plans to restart 100,000 tons of idle capacity by the end of the first quarter as global consumption enters the second phase of recovery, a senior official said.
"Large Chinese companies represent a very interesting customer segment, and that is where we would like to focus our efforts," Artyom Volynets, RUSAL's deputy chief executive for strategy, said at the Reuters Global Mining and Steel Summit.
UC RUSAL, whose largest shareholder is Russian billionaire Oleg Deripaska, is seeking a bigger share of a Chinese market where per capita aluminum consumption has doubled to 10 kg a year in the last five years, versus 20-25 kg in western Europe.
The company struck a deal in November to sell 1.68 million tons of aluminum to Chinese state conglomerate NORINCO over seven years.
"We are in discussions with several similar-sized corporations, which will hopefully be buying from us at the same levels," Volynets said on Monday. "Our goal is to sign five to eight similar customers over the next three to five years."
Demand for aluminum, used in transport, construction and packaging, was rising as the global economy enters its second wave of recovery, Volynets said.
In China, demand could rise about 20 percent this year from the 15 million tons consumed in 2009. India, with annual per capita consumption of 1.8 kg, was also a growth market, he said.
UC RUSAL has capacity to produce 4.6 million tons a year of aluminum and produced about 3.9 million last year. About 100,000 tons of idle capacity, in Siberia, Sweden and Nigeria, would be operational by the end of the first quarter, he said.
"The other 500,000 tons can also be added. It is also profitable at today's aluminum prices, but we are not in a hurry to do that," he said. "We'll review plans for this idle capacity every quarter."
Though aluminum stocks in London Metal Exchange warehouses are near record highs in excess of 4.5 million tons, Volynets said supply was tighter than it might appear.
"A very significant proportion of those inventories are still locked into long-term financial deals: 60 or 70 percent," he said. "These were two- to three-year deals, so they are not yet up for renewal.
"It's inventories in Asia that matter for the global market. In Japanese ports, in South Korean ports, they are done to a single day's consumption and that has pushed up premiums."
GLENCORE SALES
Volynets said RUSAL sold approximately 10 percent of its annual output to Glencore, the commodity trading giant that owns a stake in the Russian aluminum firm. "In a typical year, we sell roughly 10 percent to them," he said.
"Having them as a shareholder gives us a very interesting insight beyond aluminum ... It helps us to understand the bigger picture."
RUSAL, which raised over $2 billion in a Hong Kong share float in January, could potentially consider issuing convertible bonds at the suggestion of investors during the IPO roadshow.
Volynets stressed that the issue had not been discussed and that the company had no immediate need to convert or attract loans as it had agreed the terms of its debt restructuring.
"Now we have some free time, perhaps we should sit down and think about it," he said. "No thinking has been done. No decision has been made. It's something for us to consider, it's interesting and dependent on market conditions."
Volynets said RUSAL had no plans to sell its 25 percent stake in Russia's Norilsk Nickel (GMKN.MM: Quote, Profile, Research), the world's largest producer of nickel and palladium, as it preferred to keep its exposure to other metals.
"We could have sold that stake last year and paid off half of our debt, and we wouldn't have needed to go into debt restructuring. But we didn't," he said.
"We could probably sell it a year from now and pay off all of our debt, but that is not what we are going to do."
He said the entire global aluminum industry, worth $100 billion, was still less than the market capitalization of BHP Billiton (BHP.AX: Quote, Profile, Research) (BLT.L: Quote, Profile, Research), the world's largest miner.
"Unless you are in oil or, to a lesser extent, steel, you cannot build a big balance sheet on one commodity ... If you want to compete on a global scale, that's the type of company one needs to be thinking of building."
(Additional reporting by Eric Onstad, Camila Reed and Julie Crust; editing by Sue Thomas)

VHE Stimir Anode Milling Machines Save Aluminium Smelters Money
Azom.com - 07-Mar-2010
A common problem in deteriorating anode performance is the formation of spikes or mushrooms on the underside, causing reduced current efficiency and cell instability.
Often, anodes are needlessly thrown away when they develop this characteristic, wasting resources that could otherwise have been used to increase production. Stimir offers a solution to this problem - the Anode Milling Machine.
The VHE Stimir Anode Milling Machine mills away irregularities in partially used anodes, improving their profile and extending their usable life. Defective anodes are pulled from the pots and milled whilst still hot, then returned again to the original stall. Alternatively, anodes can be cooled and milled cold.
VHE offers two basic designs - a static machine installed in a fixed location, and a trailer-mounted mobile machine.
Both variations comprise a complete anode milling facility and can operate in both fully automatic and manual modes. If total control over the process is desired, each level of the procedure can be wholly manually manipulated. The user interface is a colour touch screen. Scrap carbon is collected in a container located under the machine.

Marcos Ramos Named President, Alcoa Europe; Rudi Huber to Retire
MarketWatch (press release) - Mar 4, 2010
Alcoa announced today that Marcos Ramos, 51, has been named President, Alcoa Europe effective March 8, 2010. He succeeds Rudi Huber, 56, who will retire after 29 years of service to Alcoa. Mr. Ramos will be responsible for coordinating the activities of all of Alcoa's nearly 50 locations throughout Europe. In addition, he will continue as President, Global Primary Products -- Europe, leading Alcoa's smelters and refinery in Iceland, Italy, Norway and Spain.
"Marcos has played an important role in the major changes to European primary operations, particularly the assumption of full ownership of the Elkem smelters in Norway. I wish him success in his new role," said John Thuestad, Alcoa Executive Vice President and Group President Global Primary Products.
Marcos joined Alcoa Aluminio in Brazil in 1984, later leading smelter operations and technology at Elkem Aluminium NS in Norway when it was under partnership between Alcoa and Orkla. Alcoa is now the sole owner of that operation. In 2003, he became smelter manager for San Ciprian, Spain, and in 2005, manufacturing director for Primary Products Europe. In 2007, Mr. Ramos assumed his current role leading all European primary facilities.
Rudi Huber retires after leading Alcoa finance and technology operations on three continents. Since joining Alcoa in 1981 as a credit manager in Lausanne, Switzerland, he has served as Treasurer of Alcoa Europe, Assistant Treasurer for Alcoa Inc. in the U.S., European General Director of Finance and Administration, Executive Director of Finance for Alcoa of Australia, Chief Information Officer, and Vice President of Global Business Services for Alcoa Inc. He was elected a vice president of Alcoa in 2000. Mr. Huber returned to Switzerland in 2006 as President of the European Region.
He has served as chairman of the European Aluminium Association, Vice-chair of Eurometaux, the Brussels-based EU association of the nonferrous metals industry, and AmCham-EU.

Glencore pledge to sell $1bn in assets
Financial Times - March 6 2010

Glencore, the world's biggest commodities trader, yesterday pledged to sell at least $1bn in assets over the next six months.

The move placated credit ratings agency concerns over the company's decision to spend about $2.5bn repurchasing Colombia's Prodeco coalmine from Xstrata.

The Switzerland-based trader of products from coal to corn remains in talks with companies including Vale, First Reserve and Alpha Natural Resources about selling on a stake in the coalmine, according to a person close to Glencore.

Such a stake sale could by itself generate the $1bn that Glencore is seeking as a means of protecting its credit rating, which is crucial to the privately held company's liquidity.

However, if no stake deal is reached, Glencore could sell other assets from across its global empire, which includes Century Aluminium and African copper smelters.

Glencore on Thursday met its deadline to exercise a call option on Prodeco which was agreed 14 months ago with Xstrata, the multinational miner that is itself owned 34.5 per cent by Glencore.

The call option was conceived in January 2009, the depth of the commodities-price downturn, as a controversial feature of Xstrata's Ł4.1bn rights issue.

Glencore, instead of following its rights in cash, offered to tender Prodeco to Xstrata for an agreed price of $2bn.

The price was advantageous to Xstrata at the time, and Glencore stipulated the inclusion of a call option in the deal.

While Glencore's repurchase was expected, its lack of a co-investor took some analysts by surprise. Prodeco's value is dependent on its potential for expansion, which requires $1bn in spending over the next four years, according to Xstrata.

Agreeing a stake-sale deal with a co-investor such as Alpha would introduce capital and expertise to the mine. Glencore's pledge on selling assets within six months, disclosed in a letter to creditors, suggests the company is close to agreeing such a deal, but could not finalise it before the March 4 deadline.

It has arranged a $1bn bridging loan "to enhance its liquidity position in advance of such asset realisations", the letter stated.

Glencore is understood to remain open to selling Prodeco in full.

But price may be an issue. It values the coal complex at $4bn-$5bn, partly reflecting the recent rise in thermal coal prices.

Xstrata is understood to value the complex somewhat below $3bn.

Xstrata has made a paper profit of $225m on the deal.

The call option's terms were a minimum $2.25bn resale price plus accruals, and the total value is likely to top $2.4bn.
Both S&P and Moody's confirmed Glencore's credit rating yesterday.

Aluminum Producers Cut Japan Fee, First Drop in Year
BusinessWeek - March 05, 2010
By Aya Takada
Aluminum producers cut the fee they charge Japanese buyers for the first time in a year as supply in Asia increased after Middle Eastern smelters began production and China restarted idled capacity.
Premiums for the three months ending June 30 have been set at $122 a metric ton over the London cash price in transactions agreed so far, down from $125 to $130 this quarter, said three executives involved in the negotiations. The fee had climbed to the highest level in at least 14 years. The executives declined to be identified because the talks are private.
Aluminum is little changed this year, after rallying 45 percent in 2009, as demand from industrialized nations is slow to recover and supply from new projects becomes available, leading to a global surplus. China, the biggest consumer of the metal used in cars and houses, cut purchases after record imports last year as local smelters resumed production.
“Aluminum stockpiles in China are ample after the nation bought more metal than necessary in anticipation of a demand recovery,” said Naoki Mita, manager at Barclays Capital Japan Ltd. Given a slowdown in Chinese imports and increasing output in the Middle East, the market “will be oversupplied in the second quarter,” he added.
China Buying
China’s imports of refined aluminum fell to 40,059 tons in January from 42,106 tons in December and 57,565 tons in November. Full-year imports surged to 1.5 million tons as the country’s stockpiling agency bought more than 500,000 tons to support domestic smelters and the government’s $586 billion stimulus package boosted purchases.
Aluminum smelters in China, the largest producer, restarted as much as 5 million tons per annum of idled capacity in 2009 as profit margins improved with rising prices, according to a Feb. 8 report from Macquarie Group Ltd.
Supply to Asia increased as Norsk Hydro ASA’s Qatalum smelter in Qatar started output in December. The plant will be in full production in October.
Emirates Aluminium Co., a joint venture between Abu Dhabi state-owned investment company Mubadala and Dubai Aluminium Co., started production on Dec. 1. Emal, as the venture is called, said its first output was supplied to a local client in February.
Emal agreed to supply the metal to South Korea’s Daewoo International Corp., the United Arab Emirates’ news agency WAM reported Feb. 10. Initial capacity of the smelter will reach 700,000 tons a year by the end of this year.
Additional Fee
Japanese buyers pay a fee in addition to the LME cash price to reflect local supply and demand and to include freight and insurance. Some deals for the second quarter are still being negotiated with offers at $124 or above, the executives said.
The premium, applied to so-called Good Western-grade aluminum ingot, more than doubled in the past year as lower shipments from Russia and record purchases by China reduced the metal availability in Asia. The fee increased in the three months to March 31 for a third straight quarter, adding to costs for Japanese fabricators such as Furukawa-Sky Aluminum Corp. and Kobe Steel Ltd.
Aluminum for delivery in three months on the London Metal Exchange gained 0.4 percent to $2,227 a ton at 2:10 p.m. Tokyo time. The price retreated after reaching $2,306 on Jan. 6, the highest level since October 2008.

Norway expert: Cancer low in smelter towns
Trinidad News - 04-Mar-2010
By Invera Arjoon
The medical records of Norway have recorded a lower cancer rate among those living close to the seven aluminium smelter plants than the average of the entire country.
Speaking at the South Trinidad Chamber of Industry and Commerce luncheon at Cara Suites Hotel in Claxton Bay yesterday, Dr Bjorn Erik Dahlberg former vice president of organisation environment, health and safety of Hydro Aluminium in Norway said with the new technology now available the risks are minimal.
Dahlberg said the Alutrint smelter in La Brea will be using this same modern technology.
Close to all of the smelters “there are communities with people who are living quite comfortably in fact there are even golf courses located next to the plant,” he said.
He said the emission levels are higher in the communities located in the fjords (inlet of sea between cliffs) since the emissions can be trapped there for a longer period however there has been no increase in cancer cases.
In many of the smelter communities the quality of health is just as good as before the smelters or even better, Dahlberg boasted.
Drawing reference to a picture of a fallen tree, Dahlberg said after research showed the growth of a tree was affected by the emission levels they were immediately reduced and the tree then continued its growth at the normal rate.
He said once emission levels are controlled then “effects to the environment are no longer a concern.”
Referring to Norway’s huge salmon export industry, Dahlberg said there are rivers close to the smelter plant Sundalsota, which are major breeding areas for the fish. He said all data and achievements are shared with other plants and while there were challenges “when we started meeting with the residents and asking them to share their concerns then we are able to earn their trust”.
In addition, he said working closely with the unions and the environmental authority and leaving the channels of communication open assisted greatly with their success.
Alutrint Trinidad CEO Philip Julien said Dahlberg as well as Jan O Yttredal, former general manager of Soral Huses in Norway, were invited by Alutrint to share their experiences with this country.
Julien said he hopes Alutrint would be able to put local health issues to rest and move forward.

NALCO to export aluminium billets first time in a decade
Calcutta Tube (blog) - 04-Mar-2010
Bhubaneswar, March 3 (IANS) For the first time in a decade, state-owned National Aluminium Co Ltd (NALCO) Wednesday finalized a deal to export 1,800 tonnes of aluminium billets, a senior company official said.
The metal will be supplied to British metals trader LN Metals at $130 per tonne premium over the average London metal exchange cash price on a cost and freight ex-Singapore basis, the official told IANS.
NALCO, which is Asia’s largest integrated aluminium producer, will ship the billets – 300 tonnes each – in six consignments from March to August, he said.
NALCO, whose sales prices are considered as an international benchmark, had issued a tender at the end of last year for export of 300 tonnes of aluminium billets but had to scrap it due to poor response it received.

WINDALCO to restart operations
radiojamaica.com - Wednesday, 03 March 2010
There is a glimmer of hope for Jamaica's bauxite/alumina industry with one major mining company preparing to resume operations earlier than expected.
According to an international mining website, a source close to the Russian aluminium giant UC Rusal, said the company is planning to restart its West Indies Alumina Company (WINDALCO) operations by this summer.
It said the Russian company, a 93% owner of WINDALCO will likely bring on-line just one of its facilities.
WINDALCO has operations in Ewarton and Port Esquivel in St. Catherine and Kirkvine in Manchester.
But when contacted, James Robertson, Mining Minister, said he was viewing Rusal's plan with some amount of caution in light of the precarious state of the world aluminium market.
"We are working towards a restart, retooling, re building, new energy supply using liquefied natural gas. We have a job to do but we're not going to blow trumpets until we have reached a position where's no turning back," he said.

Bauxite database offers new insight into residue management
The Australian Journal of Mining - 03 March 2010
by Paula Wallace
A tool developed by CSIRO researchers offers new insights into the best options for bauxite residue management and large-scale residue re-use.
BRaDD (Bauxite, Residue and Disposal Database) provides a comprehensive data platform for meta-analysis of trends and successes in bauxite residue processing technologies and storage practices used worldwide in the alumina industry.
“When we looked at the problem of residue management, it was clear that global trends in bauxite residue disposal, storage and management practices are largely undefined,” said Dr Craig Klauber, who leads the CSIRO research team in Western Australia who have developed BRaDD.
“The first step in addressing the residue problem was to understand it. The database is an essential assessment tool to define current practices and determine future trends.”
The nature of bauxite ores, the processing and treatment technologies, the method used for disposal and the design of the storage area all influence bauxite residue characteristics and the potential options available for re-use.
“Our aim is to develop treatment and storage strategies tailored to suit the needs of refineries and their local communities, and re-use strategies that are synergistic with local industries,” said Dr Markus Gräfe, the senior research scientist responsible for creating BRaDD.
“By using BRaDD to collect and collate data, we create a baseline for knowledge about bauxite residues. We can then find correlations that help identify optimal treatment and storage practices for residues.”
As the researchers populated the database with information, they noticed that publicly available data on bauxite residue disposal, storage and management practices provided only 25-30 per cent of the total possible data entries.
The remaining information represents a critical knowledge gap for the effective re-use and remediation of bauxite residues.
“We’re asking bauxite refiners and managers of residue disposal areas, as well as researchers in the area, to contribute data and information to ensure that BRaDD is as comprehensive as possible,” said Dr Gräfe.
“We feel that BRaDD is a critical stepping-stone in the direction of sustainable bauxite residue disposal, remediation and utilisation methods.”
“Good information is essential for good decisions, and that is what we want BRaDD to deliver.”
Industry representatives, scientists, legislators and communities will all be able to rely on this information in order to make informed decisions.
BRaDD is available online to the alumina refining industry and research community as an initiative of CSIRO Light Metals Flagship in conjunction with the Asia-Pacific Partnership on Clean Development and Climate (APP), and was formally presented at the recent APP Bauxite Residue Workshop in Nagpur, India.
BRaDD was originally developed to assist with a major research study undertaken for APP, of the alumina industry’s bauxite residue disposal, storage and management practices.
The potential for trend identification in such a complex area led to the expansion of the database to include additional information about bauxite and residue, and the eventual decision to request input from the wider industry community.
BRaDD includes information about:
. the origin and characterisation of the bauxite ore;
. the way it has been processed and neutralised;
. the disposal method and design of the disposal area; and
. the reuse or rehabilitation options used for each residue area.
Future expansion of the database will include detailed compositional information on residues.
For more information visit: http://www.csiro.au/products/Bauxite-residue-database.html

State nod for Potangi bauxite mining lease to Nalco
Business Standard - 03-Mar-2010
The Orissa government has recommended the grant of Mining Lease (ML) for Potangi bauxite reserve in Koraput district in favour of the public sector National Aluminium Company Ltd (Nalco). Potangi is estimated to have bauxite reserves of over 70 million tonnes.
However, the final ML would be granted after obtaining the prior approval of the Union government and subject to the company obtaining all the statutory clearances.
“The Orissa government has approved the grant of mining lease (ML) in favour of Nalco. The recommendation in this regard has been sent to the GoI”, Ashok Dalwai, secretary, steel and mines, Orissa government, told Business Standard.
Sources said, the state government has put some conditions for the public sector aluminium major before recommending Nalco’s case for grant of ML. The company has been asked to spend 5 percent of its net profit or Rs 10 crore, whichever is higher, on peripheral development.
A Special Purpose Vehicle (SPV) would be formed for this purpose in line with the one formed by Vedanta Aluminium Ltd (VAL) at Lanjigarh. Though the details of the modalities for formation of the SPV have not been worked out, the Revenue Divisional Commissioner (RDC) is likely to be the chairman of the proposed SPV. The ML would be given over an area of 1738.04 hectares and the company would be allowed to undertake mining outright as the area is part of the eastern bauxite belt which has been prospected.
After consultation with the Orissa government, the Union ministry of mines had reserved the area for mining by Nalco under the sub section 1(a) of section 17 (a) of the Mines and Minerals (Development and Regulation) Act, 1957.
The grant of mining lease comes as a booster to the Navratna company planning ambitious expansion plans to enhance the capacity of its refinery and smelter.
It may be noted, Nalco had applied for bauxite mining lease over an area of 2618 hectares in August 1992. Subsequently, the ministry of mines reserved 1738.04 hectares for the company in April 2007. Since then the proposal was pending with the state government for grant of ML.

Alcoa power deal sealed
ABC Australia Local - 01-Mar-2010
Environmentalists are condemning a deal between Alcoa Australia and energy giant Loy Yang which has sealed the future of the aluminium producer's Victorian operations. The company that runs both the Portland and Geelong smelters has announced a deal with Gippsland's coal power plant to supply it with power until 2036.
While there is relief for employees, contractors and unions, questions are emerging over what financial burden this might place on the Victorian public and how either business will come to the party on emissions reductions.
Alcoa's managing director Alan Cransberg says no public subsidies form a part of this agreement.
Portland's deal begins in 2016 and the Point Henry operation begins in 2014.
The spectre of a carbon tax still looms though and Mr Cransberg says this will have an undeniable effect on Alcoa's future production levels.
He says the contract's flexibility allows the company to adjust to market conditions brought about by a Carbon Pollution Reduction Scheme (CPRS).
Environmentalists are criticising the deal, saying it effectively 'locks in' a long-term reliance on coal powered energy.
The deal includes an agreement by both Alcoa and Loy Yang to reduce carbon emissions over the long-term which could include alternative energy sources, however they haven't set any binding targets.
Greg Barber, the Greens energy spokesperson says Alcoa's commitment to reducing greenhouse emissions is hard to pin down.
He says the deal doesn't make clear who will wear the cost of a CPRS and that casts a shroud over the future viability of Alcoa.

Chinalco may Sell Aluminum Processing Assets
Trading Markets (press release) - 01-Mar-2010
ZHENGZHOU, Mar 01, 2010 (SinoCast Daily Business Beat via COMTEX) --
Aluminum Corporation of China (Chinalco) will likely trigger the state-owned economy recession and private-owned economy development, once its aluminum processing assets are sold to Henan Zhongfu Industry Co., Ltd. (SHSE: 600595).
Currently, Chinalco Henan Aluminum Fabrication Co., Ltd., one of the state-owned aluminum tycoon's subsidiaries, is in talks with Zhongfu Industry about transfer of the ownership in its cold rolling plant located in the northern Chinese city of Zhengzhou, Henan Province.
Insiders revealed that the Shanghai-listed company, as a Sino-foreign aluminum producer, intended to be the majority shareholder of a joint-stock firm built on the basis of the Zhengzhou factory, and that Chinalco would buy into the new entity with land and equipment.
The main reason for this on-going deal should be the great loss of Chinalco Henan Aluminum Fabrication. Being the first aluminum processing project Chinalco invested in Henan, the Zhengzhou cold rolling plant started trial operation in 2007, but its actual production capacity could not fulfill the requirements.
Source: www.163.com (March 01, 2010)