February 8, 2012

Alcoa to review future of Point Henry Smelter in Geelong, Victoria

Alcoa announced today that it has commenced a review of the future viability of its Point Henry aluminium smelter in Geelong, Victoria, in the face of continuing difficult global economic conditions for the smelting industry.
 
The current global economic conditions are severely impacting the aluminium industry, with various companies, including Alcoa, announcing the review, closure or curtailment of smelters in Australia and overseas.
 
“A combination of factors, including metal prices, input costs and exchange rates, have resulted in the Point Henry smelter becoming unprofitable,” said Alan Cransberg, Alcoa of Australia Managing Director.
 
“Together with our employees, we have worked hard to minimise costs and improve margins, but the current situation makes it difficult for Point Henry to be globally competitive in the foreseeable future. 
 
“Our goal is for Point Henry to continue operating and meet its profitability targets. However one possible outcome of the review is that production at Point Henry may be curtailed. 
 
“I know this is unsettling news that creates uncertainty for our employees and the many people that depend on the smelter for their livelihood. 
 
“We will do all we can to ensure the smelter is competitive.”
 
Mr Cransberg said Alcoa hopes to complete the review by the end of June and make a decision about the smelter’s future at that time.  The associated aluminium rolling mill at Point Henry and Anglesea power station are not included in the review.
 
He said it is important to note that the review has not been prompted by a future price on carbon. The present situation is a result of low metal prices, a high Australian dollar, and input costs.  The future price on carbon would be an additional cost, however Point Henry smelter is already losing money.
 
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Media contact:
Nichola Holgate - 0409 036 948 or nichola.holgate@alcoa.com.au