“The turnaround in the market will happen…only if the industry manages to reduce the stock level in the warehouse” Mr Helge Jansen – MD, HYCAST AS

HYCAST AS is a well-recognized Casthouse Solution provider from Norway with extensive experience and know-how gained from numerous projects world-wide, both within Hydro Aluminium and with other aluminium companies. AlCircle Team interacted with Mr Helge Jansen – Managing Director and Einar Smarason--Marketing & Sales Manager of HYCAST during ARABAL Conference from 5th to 7th Nov 2013 at Abu Dhabi and discussed about the aluminium industry in general, the role of e-commerce and online media in the industry and about the products & services of Hycast.

Excerpts from the interview:

AlCircle: Could you please tell us in brief about your company and its products and services?

Mr. Jansen: Hycast AS was established in 1990 and it is a 100% subsidiary of Norsk Hydro. The Norwegian company has around thirty full-time employees and has an annual turnover of approximately USD 20 million.

Mr. Smarason: Hycast is a one stop shop for casthouse operations that includes melt-refining and casting technologies. I would like to emphasize that Hycast is not a typical equipment supplier but it also a process supplier. The company has expertise in project management, engineering (mechanical and electrical/automation), no matter whether you have an existing operation or establishing a new facility. One point we feel is important for our customer’s when buying a project, is to have access to the process know-how for the complete casthouse, it reduces the all the different interfaces. As mentioned before, the key advantage of Hycast is that it is not only supplying equipment to its clients but also providing the supervision, installation, training, commissioning and process know-how.

AlCircle: The general talk/ perception in the industry circle is that the aluminium sector is in general recession. How would you react to that?

Mr. Jansen: Yes…the market is pointing towards that possibility. If you ask about our take on this, we are trying to come up with our products and services in the best possible way trying to find out segments which are more special than the traditional commodity market. And I think we have products supported by the range and areas. Knowing that the primary markets are being affected by the global scenario, we are reaching out to the transportation and other special applications.

AlCircle: When do you think the turnaround in the market is likely to happen?

Mr. Jansen: Had I known that I would have taken the benefit of it! Anyway, I think it is a kind of implant that is affecting the aluminium market. I think this situation can be handled only if the industry manages to reduce the stock level in the warehouse. The oversupply in the Chinese market is also affecting the stock level. Both these factors have a role to play in the recovery of the market. The turnaround in the market will happen, but, it’ll at least take may be a year or two from here.

Mr. Smarason: The customers are asking about products, there are activities in the market despite the low price scenario. If you want to be in the market, the market should be prepared; your investment should be now and not after three years when the market improves. Then it will be too late.

Mr. Jansen: There is another factor that is affecting our business as there is not much investment on new projects. But the casthouse requires renewal and that demands investment which is going to bring about business. You cannot really continue with cost cutting for 5 to 10 years. There has to be investment and it will bring about business,

AlCircle: Which geographic regions or countries do you think would assist in overcoming the current recessionary trend?

Mr. Jansen: Definitely not Europe, but, I think, Asia in general and India are important regions for the future. I also think South American countries as well as North America and US are slightly improving and have more growth potentialities near future.

AlCircle: Do you think that as an online media Alcircle has an advantage over visual or print media in promoting your products and services?

Mr. Jansen: I think, in future print media will be less and less important and it is the online media which will be taking over in promoting products and services.

Mr. Smarason: I think it is true; people are much more glued to online media nowadays for information and it is also easy to look for company profile, products and processes over online media. It provides the apt platform for promoting your products and services and for initial communication with your potential customers & suppliers.

AlCircle: As E-Commerce has caught on in a big way in the consumer sector; do you think e-commerce can help out the aluminium industry business in overcoming these difficult times?

Mr. Jansen: My feeling is that as aluminium industry is quite special; there is no standard specification for the product, everything is tailor-made for the customers; you cannot really complete a transaction over internet. But yes, you can use it as a platform for initiating a business discussion, putting up a proposal or publishing your requirement. But, in the end, it will not be online, the final discussion or negotiation has to happen face to face.

AlCircle: What is your take on the present warehouse issues in the aluminium industry? What according to you is the reason behind low LME price and high premiums paid for the physical metal?

Mr. Jansen: That is a very technical issue to be commented upon only by the experts. Today the industry in general needs to get away with the high premiums which are established on the LME side. I think that is something which could in the long run affect the future of aluminium. The experts need to find a way out of this situation.

AlCircle: How has been your experience of attending ARABAL 2013?

Mr. Jansen: I think there have been some very interesting discussions on the conference and what I like about ARABAL is that here, it is less of presentation and more of discussions with people. And it is always important to meet and network with people from the industry and catch up with your existing connections.

Mr. Smarason: I do agree with him absolutely. It is an extremely important forum to have your networking activities and discuss with a panel of people the issues that you are facing in the industry. The conference provides a wide platform to meet our potential customers.

Disclaimer: “The information presented herein is neither intended nor implied to be a substitute for professional advice. The views and opinions shared in the interview section of www.alcircle.com are unique to the interviewees and do not necessarily reflect the viewpoint of www.alcircle.com.”