Boyne Smelter sees little hope in rising aluminium prices; says, production and job cuts unavoidable

Boyne Smelter Limited is in the process of determining the number of job cuts and production reduction at its facility in Australia. The aluminium company, unable to cope with the surging electricity costs, is mulling downsizing, reported sources aware of the matter. This comes at a time when aluminium has made a comeback from its yearlong downturn in 2015-2016. The metal, on London Metal Exchange, surged to touch a nine-month high at US$1,870 per tonne on Tuesday, January 24. Yet, Boyne Smelter seems to see little hope in the development.

Joe Rea, general manager of the Australian aluminium company said the dwindling market condition of aluminium has already made it difficult for the smelter to perform well on the global market- hence, the decision to cut production as well as jobs.

Last week Boyne Smelter announced that it would take 40 aluminium-producing cells out of circuit after it failed to secure a "globally competitive" electricity deal for the next 12 months.

"The global aluminium price has remained flat over the past six years but power prices have risen 260% in that time," Mr Rea said. "If nothing changes in the Queensland electricity market these 40 cells will stay out for the year, resulting in 45,000 tonnes less aluminium produced."

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It is already declared that jobs will be axed at Boyne Smelter, but how many- is yet to be decided.