Norwegian aluminium producer Norsk Hydro ASA announced a partial curtailment in the production of aluminium billet at Hydro Karmøy and Hydro Husnes in Europe due to a drop in demand for it on the continent.
Altogether, Hydro plans a curtailment of between 110 thousand and 113 thousand metric tons per annum. Portions of that cut will include aluminium billet capacity that has recently been shuttered already due to regular maintenance and has yet to be brought back online.
Eivind Kallevik, Executive Vice President and Head of Hydro Aluminium Metal, said in a press release that the unusual market facing the firm prompted the move.
“The extraordinary situation in the European economy and energy market is causing market uncertainty and a decline in demand for our aluminium products. Even if 50 percent of Europe’s primary aluminium production capacity has been curtailed during the last year, recent drop in demand is causing a buildup of stock, forcing us to take firm actions.”
The curtailments announced this week come on the heels of aluminium production curtailment at Slovalco almost a month ago.
“While the short-term market trend is falling and uncertainty prevails, underlying market trends longer-term will remain positive due to the rising need for aluminium in support of the European green transition. We believe that with Norway’s strong industry framework conditions, including access to renewable energy, Hydro’s Norwegian aluminium smelters are well positioned to capture the growing market for low-carbon aluminium. We will use the temporary curtailments and somewhat reduced activity levels to bring forward planned investments to develop the plants for future demand growth.”
Hydro says that the process of curtailment shall begin shortly, with Hydro Karmøy and Hydro Husnes reaching new production levels by the end of the year. This week’s curtailment is expected to result in a power savings of up to 200 mW upon complete implementation.
Norsk Hydro, which was founded in 1905, financed by the Swedish Wallenberg family and French banks, began its life named Norsk hydro-elektrisk Kvælstofaktieselskab (literally, “Norwegian hydro-electric nitrogen limited”) by Sam Eyde. The Norwegian government owns approximately 40% of the company at the present time. Norsk Hydro is one of the largest aluminium companies in the world, with plants in Rjukan, Raufoss, Vennesla, Karmøy, Høyanger, Årdal, Sunndalsøra, and Holmestrand. Norsk also has several plants abroad.