As many as six US aluminum smelters may restart in 2012: Harbor analyst

As many as six US aluminum smelters could restart in 2012 as the US market sees demand improve and aluminum supply move into a deficit, according to Jorge Vazquez, founder and managing director of market analyst Harbor Intelligence's Aluminum Intelligence Unit.

But while two other analysts agreed that the US economy is unlikely to slip into a recession, they are less optimistic in their outlooks for the aluminum market. All three spoke at Aluminum Week in Chicago this week, a meeting sponsored by the Aluminum Association and Aluminum Extruders Council.

Vazquez said the US could see a restart of six smelters because the country is returning to a deficit in aluminum and can no longer rely on Latin American exports to fill the gap. Latin America's aluminum surplus fell from 1.2 million mt in 2009 to half of that in 2010 and dropped by about another 50% to 355,000 mt in 2011, Vazquez said.

Vazquez forecast that "a portion" of the idled US aluminum capacity will come back in 2012, but that even if all of the idled capacity were to restart, the US would not return to an aluminum surplus. In an interview after his presentation, Vazquez said capacity most likely to restart is in Wenatchee, Washington, where 42,000 mt/year is offline, Ferndale, Washington, where 75,000 mt/year is idle, Columbia Falls, Montana, which has 180,000 mt/year offline, Alcoa, Tennessee, where 215,000 mt/year of capacity is idle, Ravenswood, West Virginia, with 170,000 mt/year of idled capacity and and Rockdale, Texas, where 267,000 mt/year of capacity is available.