Production of primary aluminium dwindles in South America

The recent announcement of Alumar smelter shutdown, the fifth and largest smelter to be decommissioned since 2009, has hammered another nail into the coffin of South America’s dying aluminium industry.

The three potlines at Alumar had been systematically shut down starting in 2013 and ending a few days ago. The first potline with 127,000 tons/ year capcity was launched in 1984; the second with 156,000 tons/year was launched in 1986 while the third and the largest potline was launched in 1990.

Alumar had considerably better economic viabilities than other smelter decommissioned in the area including Poscos de Caldas smelter in Minas Gerais, Valesul smelter both Alcoa project and Aratu and Ouro Preto plants belonging to Novelis.

Brazil is left with only two smelters – Albras, the 460,000 tons/per smelter owned by Hydro and Sorocaba, the 475,000 tons/year smelter owned by CBA.

Venezuela’s two smelters have avoided closure till now primarily because they are state-owned but they are not flourishing as desired while Argentina is still holding onto its sole aluminium smelter Aluar.

These pose a poor picture of the aluminium industry in South America that is bowed down by the high power charges, especially in Brazil which was struck by a severe drought resulting in the historically low reservoir levels.

Brazil from being a major importer of the metal have been reduced to being an importer and now with the permanent closure of Alumar smelter the situation is likely to worsen in future.