Norway: Norsk Hydro reduces aluminium output

Norwegian aluminium producer Norsk Hydro will cut output at two of its plants due to falling European demand, the company said in a statement on 27 September, 2022.

The extraordinary situation in the European economy and the energy market is causing market uncertainty and a decline in demand for aluminium products, Hydro said.

Hydro's Norwegian plants produce just over 1 million tonnes (mnt) of aluminium annually.

The combined cuts at Karmoey and Husnes correspond to an annual production capacity reduction of 110,000-130,000 t of primary aluminium, including production recently taken out for ordinary maintenance and not yet restarted.

The curtailment will lead to a power consumption reduction of around 170-200 MW once it is in full effect at the end of 2022.

"Even if 50% of Europe's primary aluminium production capacity has been curtailed during the past year, the recent drop in demand is causing a build-up of stock, forcing us to take firm action," executive vice president and head of Hydro Aluminium Metal Eivind Kallevik said.

Given the implications of Norsk Hydro's announcement this week, European ingot premiums could be in for a journey downwards as economic conditions worsen and manufacturing output subsides further.