A sharp drop in alumina prices in '06 and the expected cut in capacity utilzation rates highlights the difficulty a large number of alumina producers have in making profits in the current environment, says Calyon's Michael Widmer. Around 40% of all alumina refineries will find it hard to cover their costs when alumina prices stand at $200/ton. Notes although alumina has rebounded to above $350/ton, capacity utilization at alumina refineries is set to come in at 94.9% in '07, down from 99.7% previously. "This means that there is a ceiling as to how high alumina prices should be able to rise in 2007," Widmer adds.