Alcoa in Northwest smelting slowdown

By Staff -- Purchasing, 2/8/2001

Alcoa plans to reduce production at its Ferndale, Wash., smelter, making the Pittsburgh-based market leader the last of five aluminum companies operating in the Pacific Northwest to succumb to soaring power costs. Cutbacks already equal 20% of U.S. capacity of 4.3 million metric tons/year.

Alcoa owns 61% of the Intalco smelter in Ferndale, which has total capacity of 272,000 metric tons/year. How much Alcoa will curtail has yet to be announced. In various research reports, analysts have suggested the cutback could be as high as 180,000 metric tons because of high electricity prices.

The five U.S. aluminum companies operate 1.6 million metric tons in the Pacific Northwest, or 38% of U.S. aluminum capacity. Excluding Alcoa's latest cuts, Merrill Lynch senior metals mining analyst Daniel Roling estimates about 868,000 metric tons of production has been idled in the Pacific Northwest because of the region's power crisis.