Kaiser Aluminum: Market Still Tough; Anglesey Smelter To Close

SYDNEY -(Dow Jones)- Kaiser Aluminum Corp.'s (KALU) chief executive said Thursday current market conditions remain challenging, and he expects further destocking among aluminum consumers, but that long-term fundamentals are still positive. "In the near term, we expect weak demand and de-stocking for aerospace and high strength applications to continue, particularly for the higher value-added products," said Jack A. Hockema, president, chief executive and chairman in Kaiser's second quarter results statement. The U.S.-based producer also said it still expected to close the 148,000 metric-ton Anglesey Aluminium Smelter in Wales, which it co-owns with global miner Rio Tinto PLC (RTP), at the end of September. Media reports in the U.K. earlier this month said the joint venture partners were to consider a U.K. government rescue worth almost GBP50 million. "We are cautiously optimistic that de-stocking trends for these products are beginning to moderate. However, we have not yet seen clear indications of improving demand for these applications. Overall, in the third quarter 2009 we anticipate that the fabricated products shipments and product mix will be comparable to the second quarter 2009 levels," Hockema said. -By Elisabeth Behrmann, Dow Jones Newswires; 61-2-8272-4689 elisabeth.behrmann@dowjones.com