AluNews - April 2014

Guide to setting up aluminium powder plant

Metal Powder - April 29th 2014,

Research and Markets has published “Prefeasibility Report on an Aluminium Powder Manufacturing Plant”, a guide to setting up an aluminium powder manufacturing plant.

The study covers all the necessary aspects of the aluminium powder plant including commercial and technical. It ranges from macro overview of the market to micro details of the industry performance, processing and manufacturing requirements, project cost, project funding, project economics, expected returns on investment and profit margins.

Written by advisory firm the IMARC Group, It is suitable for entrepreneurs, investors, researchers, consultants, business strategists, and all those who are planning to enter into the aluminium powder industry.

Sohar aluminium project on track

Oman Tribune - April 29th 2014,

SOHAR The foundation stone for construction of an aluminium coating project was laid at Sohar Industrial Estate, under the patronage of HE Sheikh Said bin Humaid al-Harthy, Wali of Liwa.

The total cost of the project which is the first of its kind in the Sultanate stands at 32 million rials equivalent to $83 million. Its production capacity is about 25,000 tons per annum of multipurpose coated rolled aluminium.

UC RUSAL purchases over 80 auxiliary machines and vehicles to reduce manual labour at its Aluminum division smelters

RUSAL - April 23rd 2014,

UC RUSAL (SEHK: 486, Euronext: RUSAL/RUAL, Moscow Exchange: RUALR/RUALRS), a leading global aluminium producer, has purchased over 80 different machines and mobile equipment units to strengthen labour mechanisation efforts at its Aluminium Division production sites. The company spent a total of RUR 132 mln on the purchase, R&D and maintenance of auxiliary process machinery for potrooms in 2013 alone.

10 highly maneuverable Bobcat loaders equipped with hydraulic breakers that are vital to facilitate pot treatment operations are arriving at the Bratsk aluminium smelter, and Hencon, another machinery supplier, has designed a customised pot tending vehicle with a set of detachable tools that will help staff in their daily routine on the shop floor.

In 2013, the aluminium smelters in Krasnoyarsk (KrAZ), Irkutsk (IrkAZ), and Novokuznetsk (NkAZ) received 60 diesel lifters worth a total of RUR 42 mln. The latter two smelters also purchased anode paste loaders.

KrAZ continued its conversion programme with a focus on using more Russian-made machinery in its operations. This project has the goal of reducing the costs of manufacturing and maintaining machinery. The smelter’s team was able to negotiate prices at 2009 levels and also to cut maintenance budgets using various optimisation measures. In 2013, the project built 9 mobile equipment units, with another 7 to be put into service in 2014 and one of these ‘next-generation’ machines to be electrically driven. Along with the conversion programme, KrAZ is moving ahead at full speed with engineering and testing modernised pot tending overhead cranes.

‘Labour mechanisation contributes to a more rational, more economic resource allocation, lower production costs and improved metal quality. It also helps the company in its ambitions to reduce emissions and improve on other environmental performance parameters, raise productivity and make jobs more attractive’, says Evgeny Nikitin, the Head of the Aluminium Division.

Inalum Prepares US$1.9 Billion For Aluminum Smelter

Bisnis Indonesia Group - April 22nd 2014,

JAKARTA - Indonesia Asahan Aluminium (Inalum) is ready to invest US$1.9 billion by 2019 to increase the capacity, either through optimization or expansion.

PT Inalum President Commissioner Agus Tjahajana Wirakusumah said Inalum plans to increase aluminum ingots production capacity up to 500,000 tons per year.

Currently, Inalum ingot production reached around 256,000 tons per year. To expand it, the company with the team is conducting feasibility study (FS) which was planned to be completed by the end of this year.

In line with the FS to be a line expansion of the smelter, the company also performs the optimization of existing smelters. Before it being taken over by the Indonesian government on November 1, 2013 and changed into state-owned enterprise (SOE), the production of aluminum ingots reached only 225,000 tons per year.

After the takeover, the company would perform the optimization by adding transformer and replacing old tools for the sake of better production.

Now, the production may reach 256,602 tons per year, whereas the initial target were only 254,000 tons per year. He targeted the optimization of production this year could reach 260,000 tons.

In 2015, aluminum ingot production could reach 300,000 tons per year. The cost of such optimization would use internal funds. As of October 2013, the company's internal funds reached US$390 million.

"With the addition of new production line, production could increase to 500,000 tons in 2019. The increase would be gradual, 400,000 tons in 2018, 500,000 tons in 2019," said Agus, Monday (4/21).

According to him, in order to achieve production of 500,000 tons per year, it should build a new smelter line. Investments made to build a smelter and its complementary reached US$1.9 billion.

In detail, to build a processing line requires funding of about US$1.2 billion and the construction of power plant with a capacity of 513 megawatts (MW) costs approximately US$700 million.

Previously, the government investment required by Inalum to increase production capacity reached approximately US$1 billion or IDR10 trillion. However, the plan was simply to increase the capacity up to 360,000 tons to 400,000 tons per year. At present, the company plans to invest in order to increase the capacity even greater.

CHALIECO Signs $498-mln EPC Contract with Venezuela's CVG Venalum

Shanghai Metals Market - April 21st 2014,

SHANGHAI, Apr. 21 (SMM) – China Aluminum International Engineering Corporation Limited (CHALIECO) signed a $498-million engineering, procurement and construction (EPC) contract with Venezuelan aluminum producer CVG Venalum.

As the EPC contractor, CHALIECO will work on recovering capacities of 720 aluminium cells, remoulding five valves and four electrolytic series rectifiers, China’s State-owned Assets Supervision and Administration Commission (SASAC) said on its website today.

``This is a big breakthrough for CHALIECO to go into international market,’’ the SASAC said in a statement.

CHALIECO is affiliated to Aluminum Corporation of China (CHINALCO).

BHP Billiton to curtail aluminum capacity at Brazil's Alumar smelter

BN Americas - April 16th 2014,

As challenging conditions in the aluminum industry persist, global resources giant BHP Billiton (NYSE: BHP) decided to curtail capacity by 58,000t at Brazil's São Luís (Alumar) smelter starting in the June quarter.

BHP's new curtailment follows the suspension of 45,000t capacity at Alumar in the September 2013 quarter, the company said in its latest production report.

Aluminum production at Alumar declined 30% to 26,000t in the March quarter, while alumina output increased 4% to 314,000t.

Located in northern Brazil's Maranhão state capital São Luís, Alumar is a partnership between BHP Billiton, Pittsburgh-based aluminum giant Alcoa (NYSE: AA), and Rio Tinto's Alcan subsidiary. The refinery was opened in 1984.

Norsk Hydro: Hydro agrees to sell aluminium casthouse in Hannover

IT Business Net - April 14th 2014,

OSLO, Norway, April 15, 2014 (GLOBE NEWSWIRE) -- Hydro has entered into a binding agreement to sell its special alloy aluminium casthouse in Hannover to IQ Industrial Holding S.à r.l. (Luxembourg), a private industrial holding group with operations across Europe.

The Hannover casthouse is focused on special aluminium alloys, mainly hard alloys for the aerospace industry. Through the agreement, IQ Industrial Holding will acquire 100 percent of the shares in Hydro Giesserei Hannover GmbH.

The Hannover casthouse was taken over by Hydro through the acquisition of VAW aluminium AG in 2002 and is considered non-core business. The casthouse supplies its hard alloy products mainly to a customer located wall-to-wall.

The Hannover casthouse has around 30 employees and produced approximately 12,000 tonnes of aluminium products in 2013.

Project to boost Sohar Aluminium output

Oman Observer - April 13th 2014,

By Conrad Prabhu — MUSCAT — Sohar Aluminium, Oman’s biggest non-hydrocarbon industrial venture, has approved plans for the implementation of a productivity optimisation project that will boost output by a significant 28,000 tonnes of primary aluminium annually. The so-called ‘Amperage Creep’ project is one of two important initiatives launched by the company with the aim of optimising energy efficiency and productivity at its giant smelter located in Sohar Industrial Area. The other initiative concerns a comprehensive revamp of the potline designed to achieve a reduction in energy consumption, according to a top official. “During the last two years, Sohar Aluminium (SA) initiated an upgrade of the pot lining, thereby opening new avenues in terms of current efficiency and operating amperage. The full deployment of these new state-of-the-art pots will be achieved by the end of the year. This will lead to new production levels for SA,” said Said Mohammed al Masoudi, CEO.

“The SA team will also optimise and improve the specific energy consumption of the potline to reduce our aluminium cost per tonne. Meanwhile, we will continue to explore all opportunities for growth, including asset expansion scenarios,” he further added. Last December, shareholders of Sohar Aluminium approved a significant investment to support an amperage creep project to reach an operating level of 400kA in the coming years and boost production of primary aluminium by an approximately 28,000 tonnes planned to be completed by 2019, Al Masoudi stated. Both projects are in line with Sohar Aluminium’s efforts to maintain its position as a benchmark for aluminium smelting operations around the world. The Oman plant’s Aluminium Pechiney technology (AP3X) is globally acclaimed as superior, environmentally friendly and energy-efficient.

Established in 2004, the $2.4 billion venture is the product of a partnership between Oman Oil Company (40 per cent), Abu Dhabi National Energy Company PJSC-TAQA (a subsidiary of Abu Dhabi Water and Electricity Authority) (40 per cent) and Rio Tinto Alcan, a global leader in aluminium. SA produces 375,000 tonnes of primary aluminium per year in the form of hot metal, ingots and sows from its world-class 1.2 km potline consisting of 360 pots using state-of-the-art Aluminium Pechiney technology (AP3X). The smelter itself is powered by a 1,000 MW combined-cycle captive power generation facility designed and built by Alstom and owned by Sohar Aluminium. Since it came on stream in June 2008, SA has been playing a pivotal role in the development of aluminium transformation industries in Sohar. The company has committed 60 per cent of its hot metal output for use by local downstream industries in the manufacture of a variety of aluminium-based products.

“The growth of a strong aluminium-based downstream cluster at Sohar is built on the foundation of SA providing molten aluminium to feed the downstream businesses. In the absence of SA, the economic and logistic challenges of importing liquid or solid aluminium to supply downstream businesses would make it very difficult for these businesses to sustainably grow in the long-term. SA will support the established downstream companies as they continue to grow while also looking to leverage the favourable business environment of Oman to attract new potential projects to the region,” said Al Masoudi. The biggest of the downstream ventures which depend on SA for its hot metal feedstock is Oman Aluminium Rolling Company LLC (OARC). Owned by Takamul Investment Company, which is itself a subsidiary of SA shareholder Oman Oil Company, OARC is designed to produce 160,000 tonnes of multi-purpose aluminium sheets which are to be sold in the local market and exported to the Middle East, Asia, Europe, Australia, North and South America.

Value-addition is also the objective behind a similar arrangement between SA and Oman Aluminium Processing Industries LLC (OAPIL), which utilises molten metal from the smelter to produce aluminium and alloy rods, as well as overhead transmission line conductors. OAPIL is a joint venture between Oman Cables Industry and Takamul Investment Company. The total production capacity of the OAPIL plant, which is also located in a downstream aluminium park adjacent to the smelter, is around 57,000 tonnes per annum of products. As one of Oman’s leading mega-projects, SA has successfully managed to leverage its investments and operations to make a profound impact on the local community. Of around 1,000 jobs created by the venture across its sprawling complex, approximately 71 per cent are held by Omanis hailing primarily from the Batinah belt. (OEPPA Business Development Dept)

Aluminium smelters pushing for RET out

The Australian - April 12th 2014,

THE embattled aluminium industry is pressing for a total exemption from the renewable energy target to cut $80 million a year from its cost burden and improve its competitiveness against other countries.

But the move has concerned the Australian Industry Group, which has warned that granting an exemption to the aluminium industry would force other electricity users to pay more.

Aluworks to increase capacity

Ghana Web - April 10th 2014,

Aluworks Limited, an aluminium products manufacturing company, is to raise its annual production capacity from the existing 30,000 tonnes to 50,000 by the middle of the year.

This follows the installation of a new cold-rolling mill to replace the existing one. The current mill has been in operation for the past 30 years.

The Sales and Marketing Manager of Aluworks, Mr Christian Opare-Larbi, said the switch to the new mill would also help improve the efficiency of operations and the quality of products.

He said this in an interview with the Daily Graphic at the solo exhibition of made-in-Ghana products in Ouagadougou, Burkina Faso.

"The way forward now is for us to grow our traditional market, which is the West African sub-region, so that we can export more products there," Mr Opare-Larbi, who is in charge of the northern sector, said.

Aluworks produces aluminum flat-rolled coils, discs and roofing sheets to the construction industry and kitchenware manufacturers in and outside the country.

It was one of the four metal manufacturing companies that participated in the seven-day exhibition put together by the Association of Ghana Industries (AGI).

The event was supported by the Ghana Embassy in Burkina Faso, Ghana Export Promotion Authority (GEPA) and Export Development and Investment Fund (EDAIF).

Chinese alumina prices weak; govt intervention may halt further production cuts

Metal Bulletin Ltd. - April 3rd 2014,

Chinese alumina prices remained weak this week amid sluggish demand ahead of the long weekend.

Alumina was offered around $319 per tonne fob Australia this week, compared with $317-318 per tonne last week, according to market participants.

"The suspension of alumina loading at a Norsk Hydro facility has boosted overseas prices but Chinese buyers are not interested in importing at the moment," a Beijing-based analyst said.

Loading of alumina at Alunorte has been suspended by the local environmental watchdog, but its production continues unaffected, Norsk Hydro said on Tuesday April 1.

China port prices for alumina were flat at 2,540-2,550 yuan ($412-413) per tonne fot in Liangyungang of Jiangsu province this week.

"Trading of imported alumina has been stable, with most transactions done for 200-300 tonnes. Few are buying 1,000 or 2,000 tonnes," a dealer said.

On the local spot market, alumina was at 2,180-2,520 yuan per tonne on Thursday April 3, unchanged from the level on March 28.

Spot trading was slim this week and "many have delayed signing deals due to the looming Tomb Sweeping Day in China on Monday April 7," the analyst said.

Some small alumina makers were seen undercutting prices in the past week.

In Henan, the mainstream prices were around 2,480 yuan while some smaller producers were selling at 2,400 yuan per tonne, market sources said.

In Guangxi, a few were selling at 2,170 yuan per tonne, below the mainstream minimum level of 2,180 yuan per tonne, according to market participants.

"Some small alumina makers are struggling and they don't want too much inventory on hand, so they chose to dump material for cash," a trader said.

Outlook

Market participants are mixed towards outlook.

"The fundamentals are still not good and any rebounds won't last," the Beijing analyst said.

Others saw a balanced market.

"Few aluminium smelters out of Guangxi and Guizhou are seriously cutting production due to resistance from local governments," a market source said.

As an example, Shenhuo Group in Henan was slated to halt 100,000-tpy capacity but failed to do so due to local government intervention, according to market sources.

"The local government asked the company to wait for a while," the market source said.

"There are talks that in Henan, local governments are providing help to smelters to keep factories running. Measures include guaranteeing bank loans or tax exemption for smelters," another source said.

"Some smelters announced production cuts just to give the local government signals that they need help," the source said.

The recent rebound in aluminium prices have also mitigated the need to reduce production.

Aluminium prices have been in an upside trend since March 21. On Shanghai Futures Exchange, the June aluminium contract has gained 2.7% since March 21 to reach 13,110 yuan per tonne on Thursday April 3.

"New capacity coming on stream in north-west part of China should offset reductions in south-west China. The (alumina) market is in balance in general," Liu Xiaolei, SMM analyst, said.

Aluminium firm acquisition

Engineering Capacity - April 2nd 2014,

The Sapa Group is strengthening its range of advanced aluminium solutions with the acquisition of UK-based Holden Aluminium Technologies Ltd.

Holden’s aluminium extrusion fabrication plant is located in Bromyard, England, and employs about 60 people. The site specialises in the supply of formed and machined components for segments including construction, transport and general engineering.

Following the acquisition, Holden will retaining its own name, but the Bromyard plant will become part of Sapa’s extrusion unit in the UK, joining sister operations in Birtley, Cheltenham, Gloucester, Redditch, Rotherham and Tibshelf.

“Adding the Holden operation is part of Sapa’s strategic objective to become the leading supplier of value-adding aluminium solutions in the UK,” said Alain Couturier, vice president Sapa Extrusion Europe West.

Holden which is a privately owned company which has been in business over 50 years, has established itself at the cutting edge of forming technology.

The move should provide long term security for the future of the business and allow it to grow even stronger under the umbrella of the Sapa Group.

Sapa Group is a world leader in aluminium solutions. It has a global reach within the extrusions, building systems, and precision tubing sectors with over 23,000 employees in more than 40 countries.

ANorsk Hydro: Loading of alumina at Alunorte suspended, production continues unaffected

Thomson Reuters - April 1st 2014,

The Pará State Environmental Secreteriate (SEMA) has suspended Alunorte's environmental operational license for loading of alumina at its port, Vila do Conde, with effect as of 1 April 2014. This results in the suspension of all loading of alumina with immediate effect. The production of alumina at Alunorte continues unaffected.

SEMA argues that Alunorte has not fulfilled one of the conditions under the license, which is to present a plan to reduce emissions of alumina dust in the port loading operation. Alunorte believes it is already using one of the best available technologies for alumina loading and disagrees with SEMA's understanding that the license condition is not fulfilled.

Alunorte will continue its dialogue with SEMA and expects that the matter will be resolved and that the loading of alumina will resume without affecting production.

Alunorte has a nameplate capacity of 6.3 million tonnes and is the world's largest alumina refinery.

Alcoa to Curtail 147,000 Metric Tons of Aluminum Smelting Capacity in Brazil

Alcoa Inc. - March 28th 2014,

NEW YORK & SÃO PAULO--(BUSINESS WIRE)--Alcoa (NYSE: AA) today announced it will curtail 147,000 metric tons of smelting capacity at its São Luís (Alumar) and Poços de Caldas smelters in Brazil due to challenging global market conditions in primary aluminum and increased costs that have made the smelters uncompetitive. The curtailments are expected to be complete by the end of May 2014.

In 2013, the Company curtailed 34,000 metric tons at Poços and 97,000 metric tons at São Luís. The new curtailments will include the remaining 62,000 metric tons of capacity from the Poços smelter, resulting in a full curtailment of its three potlines. Another 85,000 metric tons will be curtailed at São Luís.

“Across the globe, we are taking measures to curtail high-cost smelting capacity that is not competitive and reshape our cost profile,” said Bob Wilt, President of Alcoa Global Primary Products. “These are difficult but necessary actions in support of Alcoa’s strategy to lower the cost base of our upstream businesses.”

As a result of the smelter curtailment, the Poços refinery will also reduce production accordingly. The mine, aluminum powder plant and casthouse at Poços will continue normal operations, as will the refinery at São Luís. Other Alcoa operations in Brazil are not affected.

“We know how deeply this decision affects our employees, our contractors and our communities,” said Aquilino Paolucci, President of Alcoa Latin America and the Caribbean. “While our teams have worked incredibly hard to make these facilities more competitive, we must take steps regarding our primary metal production in Brazil given the market conditions we are facing. We appreciate the support of governments at all levels, and will actively work in partnership with our employees, unions, and community stakeholders to manage through this transition and minimize the impact.”

In May 2013, Alcoa placed 460,000 metric tons of smelting capacity under review. Once all announced curtailments and closures are complete, Alcoa will have approximately 800,000 metric tons, or 21 percent, of smelting capacity offline.

Total restructuring-related charges associated with the Brazil curtailments in the first quarter are expected to be between $40 million and $50 million after-tax, or $0.04 to $0.05 per share, of which approximately 30 percent would be non-cash.

Alcoa’s review of its primary metals operations is consistent with the Company’s goal of lowering its position on the world aluminum production cost curve to the 38th percentile and the alumina cost curve to the 21st percentile, by 2016.

New manufacturing plant boost for Hunter

ABC - March 28th 2014,

There is a vote of confidence in the Hunter's aluminium sector, with a $60 million cables manufacturing plant being commissioned at Tomago today.

Bahrain-based Midal Cables International has built the manufacturing plant at Tomago which will use molten metal from the nearby aluminium smelter.

It will use the molten aluminium to make rods, wire and conductors.

Midal Cables managing director Hamid Al Zayani says the plant will play a key role throughout the Asia Pacific.

"This optimism comes from the fact first that we have a very important market share in the Australian market that we'd like to protect and consolidate," he said.

"But also this country enjoys a high level of free trade agreements with the rest of the world and we are looking at this factory to be the hub for servicing the Pacific rim."

In 2012 the Hydro aluminium smelter closed its Kurri Kurri plant because of high production costs, the impact of the Australian dollar and low prices.

Mr Al Zayani says the Midal plant will be state of the art and its prospects are good.

"Aluminium has been growing at 15 per cent per year on a global basis," he said.

"Some smelters are proving to be not viable to carry on but if you look at the global consumption that has been going up 10 or 15 per cent.

Only the effective smelters will survive.

"The ones that carry the highest technology and most competitive energy."