Rio Tinto’s aluminum production dips in Q2 2008

Rio Tinto Alcan reported a dip in attributable aluminium production to 1.014 million tonnes in Q2 2008 from 1.025 million tonnes in Q1 2008. Pro forma production—accounting for the purchase of Alcan in October 2007—was flat year-on-year. Lower quarterly production reflected issues at two of the group’s smelters. In New Zealand the Tiwai Point smelter initiated a 10% production cutback during the quarter in response to rocketing local power prices. The size of the cutback equates to the smelter’s level of dependence on the spot power market as opposed to its long-term power contract. Smelter production fell to 82,000t in Q2 from 87,000t in both the preceding quarter (Q1 08) and the year-earlier period (Q2 07). Rio Tinto warned that the cutback is expected to continue over the course of Q3 2008. A fire at the Anglesey smelter in the UK in June knocked out two-thirds of capacity and production here dropped to 32,000t in Q2 08 from 37,000t in both the preceding and year-earlier periods. Rio Tinto gave no time-frame for a return to normality but minority partner Kaiser Aluminum has said it will be at least four months. Capacity creep elsewhere in the company’s smelter network part compensated for these two production hits and generated the unchanged year-on-year production comparison. Production will also get a boost from the ramp-up of the new Sohar smelter in the Persian Gulf country of Oman. Rio Tinto Alcan holds a 20% interest in the 350,000tpy smelter, which produced its first hot metal in June. Source: Metals Insider