Alcoa (NYSE: AA) could cut as much as 460,000 tonnes, or around 11%, of its smelting capacity due to a more than 33% plunge in aluminum prices since their peak in 2011.
The alumina producer plans to review its smelting capacity for possible curtailments over the next 15 months.
Chris Ayers, president of Alcoa’s Global Primary Products, said because of persistent weakness in global aluminum prices, the company needed to review every option to maintain its competitiveness.
Pittsburgh-based Alcoa operates smelters in the U.S., Canada, Brazil, Australia and Europe.
The review will focus on higher cost plants and plants that have long‐term risk due to factors such as energy costs or regulatory uncertainty.
Currently, Alcoa has 13%, or 568,000 tons of smelting capacity idle.
Benchmark aluminum prices on the London Metal Exchange Wednesday traded at $1,824 a metric ton.
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