Europe’s largest aluminium smelter has agreed to buy feedstock alumina from Anglo-Swiss metals miner Glencore plc, widening its supply pipeline from its original alumina supplier Trafigura.
Aluminium Dunkerque also signed a new deal to sell primary aluminium to Glencore, which it has already been marketing metal to prior to these new deals. The contracts begin in 2023 and will span several years. The aluminium smelter said the new arrangements supersede existing deals between the two firms. Details of the new agreements are sparse, but Aluminium Dunkerque assures investors that they are in line with previous deals made by the firm.
“Commercial terms of the contracts are confidential. All prior arrangements between AD and Glencore have been canceled,” the smelter said earlier this week.
In a press release, Aluminium Dunkerque’s Chief Executive Guillaume de Goÿs said the new deals were a hedge against economic disruption.
“We believe these arrangements will increase the diversity of Aluminium Dunkerque’s counterparties at a time of considerable market volatility.”
Aluminium Dunkerque was acquired by American Industrial Partners (AIP) last year, but not without a fight from the plant’s prior owner GFG Alliance. GFG’s head Sanjeev Gupta alleged that AIP acted in bad faith to foreclose on a financing deal to take over the plant.
In addition to the above deals, Aluminium Dunkerque also agreed to a non-exclusive multi-year financing deal with Glencore, allowing the smelter to hedge its aluminium prices with the firm.
The 286 thousand metric tons per annum aluminium smelter’s existing deal with Trafigura is scheduled to expire at year’s end. Aluminium Dunkerque said it continues to be on the lookout for new sales opportunities.