News

Aluminum in Brazil is too much to handle

Issued at 2014-09-10



Producing aluminum in Brazil got so expensive as electricity prices surged to records this year that Alcoa Inc. (AA) idled its Pocos de Caldas smelter and now sells the facility's power instead of metal. 

The worst drought in decades drained reservoirs used to run hydroelectric generators that supply power to extract aluminum, boosting costs already inflated by more spending on labor and transportation. 

Aluminum smelters are electricity guzzlers, with power accounting for as much as half the cost of producing refined metal. 

"It's not economical anymore," said Milton Rego, executive president of the Sao Paulo-based Brazilian Aluminum Association, known as ABAL, which represents the $18 billion domestic industry. "Its the chronicle of a death foretold."


Source: Aluplanet



Related News