Alcoa smelter closure to bring U.S. aluminum output to post-WWII levels (Reuters U.S. – January 7, 2016)

http://www.reuters.com/

NEW YORK – Alcoa Inc’s (AA.N) plans to close its 269,000 tonne-per-year Warrick smelter, announced on Thursday, will bring U.S. aluminum output to its lowest level in more than 65 years as the industry endures tumbling prices amid rising trade tensions with China.

Warrick is the largest currently-operating smelter in the United States and the biggest shoe to drop in a string of recent curtailments and closures, potentially boosting prices and possibly bolstering some U.S. producers’ claims they are harmed by subsidized Chinese production.

The Evansville, Indiana plant’s closure, which will take place by the end of the first quarter, will leave Alcoa with just one active smelter: the 130,000 tonne-per-year Massena West plant, which was saved from closure with $70 million in New York state aid.

It will bring annual U.S. production of aluminum, which became a key strategic material during World War II, down to around 720,000 tonnes, the lowest level since at least 1950, according to the U.S. Geological Survey.

Five U.S. smelters will operate following Warrick’s closure, compared with eight at the beginning of 2015 and 23 in 2000.

In a statement, Alcoa global primary products president Roy Harvey said “these assets are not competitive” amid “challenging market conditions.”

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