Rusal And Braidy Industries Announce Deal To Build Automotive Aluminium Plant In Kentucky

Rusal And Braidy Industries Announce Deal To Build Automotive Aluminium Plant In Kentucky

With the weight of sanctions finally lifted from its shoulders, Russian Federation aluminium giant U.C. Rusal announced earlier today a joint venture with Braidy Industries to construct and operate a flat-rolled aluminium rolling plant in Ashland, Kentucky.

Per Rusal, the mill will have a nameplate capacity of 800 thousand metric tons per annum, with 500 thousand metric tons per annum devoted to hot-rolled band, and the balance to fully-finished cold-rolled aluminium products. The mill will feature state-of-the-art equipment, including the widest cold-rolling mill in the United States at 104”.

The new mill will be fed raw aluminium from Rusal’s own smelters, specifically from operations at an under-construction smelter in Taishet, Siberia. Once constructed, Rusal will retain a 40-percent share, with the remaining ownership vesting in Braidy.

Though the two firms agree on the broad details of the project, a myriad of minute arrangements remain to be settled. As a result, the parties drafted a Letter of Intent on the project that spells out commercial conditions for the joint venture as well as establishing a framework for future negotiations. The document will likely be signed by the conclusion of the current quarter.

Per Rusal, the project is in response to an ever-growing demand for flat-rolled aluminium products in North America, specifically among automakers. The firm expects such growth to continue in large part due to Corporate Average Fuel Economy (CAFE) standards implemented by the United States government that mandate progressively better fuel economy from new cars. Rusal and Braidy hope to make the most of this rise in demand by locating the mill in Ashland, which places it in close proximity to a significant number of automotive components manufacturers.

Rusal lauds the project as a prime opportunity for expanding its expertise in a growing aluminium market. The project will also dovetail with its commitment to increase the share of value-added products it offers.