Smelter not out of the woods

Press, 12 February 1986, Page 37

Smelter not out of the woods

Low world aluminium prices and competition from Third World countries mean costs must be contained at the Bluff aluminium smelter, says Comalco, Ltd. The deputy managing director of Comalco, Ltd, Mr Norman White, was in Christchurch yesterday for the opening of a Comalco aluminium service centre in Moorhouse Avenue. Comalco owns 50 per cent of New Zealand Aluminium Smelters, which runs the Bluff smelter. The other partners are Japanese firms. Mr White said the world price of aluminium had improved from terrible to bad. Aluminium was now selling from SUSII2O to SUSII3O a tonne. He would like to see it over SUSI4OO. The international market for aluminium is now mature. World demand for aluminium is increasing about one to two per cent a year, compared with the metal’s big-growth years of the late 1960 s and early 19705, when demand increased 6 to 7 per cent a year. Many new smelters had been built since then in South America and other countries, Mr White said. These mostly had cheaper power or labour than Bluff, or else their State owners did not care whether they made a profit. Bluff was still a good smelter, Mr White said. Technologically, it was in the top third in the world. Last year, output at the smelter was allowed to fall by non-replacement of smelting pots as they failed. This year, production is being maintained by replacement of newly failed pots. Mr White said not much more could be done to automate the Bluff smelter. It was computerised and as tightly staffed as possible. There was no room to absorb cost increases. A third factor now is New Zealand currency. The rise of the N.Z. dollar against the U.S. dollar has added to the smelter’s costs. The aluminium centre opened yesterday is the first Comalco base in Christchurch. Similar service centres have been opened in Auckland and Tauranga.