Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Norsk Hydro’s majority-owned aluminium plant in Slovakia will cut its output to around 60% of capacity in response to high electricity costs, the Norwegian company said on Thursday.
A surge in power and natural gas costs across Europe this year has led to output reductions at smelters, chemical plants and other affected industries.
The Slovalco plant, 55.3% owned by Hydro, which had already announced a capacity cut to 80% in 2019, said the new cut to 60% corresponds to an annual reduction of 35,000 tonnes of aluminium. It did not say when it would take effect.
“Slovalco will continue to monitor the situation closely in the coming weeks and months,” Hydro said in a statement.
In Norway, Hydro, which has not announced any other cuts, is sheltered from price volatility by the company’s own hydroelectric capacity and long-term renewable supply details.
As energy ranks among the biggest costs for energy-intensive industries, metal producers and other sectors have asked the European Union for help, saying the record prices have hit their competitiveness and could prompt European companies to relocate.
On Wednesday, U.S. aluminium maker Alcoa Corp announced a deal with workers to end primary aluminium production at its San Ciprian facility in Spain for two years, citing high energy costs.
(By Terje Solsvik; Editing by Jason Neely and Barbara Lewis)
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