Akwa Ibom - The Aluminium Smelter Company of Nigeria (ALSCON) in Ikot Abasi Local Government Area of Akwa Ibom says it is losing 6.1 million dollars monthly due to high cost of production.
Tatyana Smirnova, its Director of Public/Government Relation, disclosed this to the News Agency of Nigeria (NAN) on Monday in Ikot Abasi.
"Each tonne of aluminium produced at ALSCON results in a loss of 886 dollars which leads to monthly loss of 1.6 million dollars by the plant,’’
"At present, aluminium industry globally is going through one of the toughest periods in its history, she said.
The spokesperson said that price of aluminium had continued to decline globally, noting that currently the price of aluminum stood at slightly over 1 700 dollars per tonne.
"At the current price of below 1 800 dollars, around 40 per cent of aluminium production is unprofitable," she said.
Smirnova said that aluminium production was going down globally, adding that more than three million tonnes of aluminium production would be closed by the end of 2013.
According to her, the major problem is the huge amount of stock available in the market since the global financial crisis of 2008 and 2009.
"The official London Metals Exchange (LME) has stocks exceeding five million tonnes, while the global stock is significantly higher," she said.
According to her, it will take the global aluminium market up to three years for supply and demand to balance and improve the current situation.
Smirnova attributed the suspension of production at ALSCON in March to high cost of aluminium.
She said that the company had a gas fired power plant of its own with capacity of 540 megawatts.
Smirnova said that the power plant could satisfy the electricity needs of the smelter and also supplied excess production to the national grid.
She said that the power plant was capable of supplying 360 megawatts of electricity to the national grid.
She said that there was no likelihood that ALSCON would resume aluminium production until the power supply issue was resolved.