Alro Slatina could only recover in 2023 to the level of electrolytic aluminum production recorded in 2021, if energy prices do not reach new highs, the company said. Alro has previously announced that it will reduce its production due to energy prices.
“We are actively looking for solutions to meet the energy needs for 2023 for all five electrolysis halls and thus to maintain the vertical integration feature of our business, as we believe that integration will remain one of the main benefits in the long run of our business model,” said Marian Năstase, Chairman of the Board of Directors of Alro, according to a statement sent to the stock exchange (BVB).
“Based on our current estimates, the restart costs for each electrolysis hall could be in the range of USD 10-12 million, depending on the prices of the raw materials at that time and the time elapsed since they were placed in storage,” he added.
In 2022, the company implements the announced production plan to resize the production of electrolytic aluminum and work with two out of five electrolysis halls, while taking the necessary technological measures to allow a quick and efficient restart when energy market conditions return to a sustainable level.
In addition, Alro focuses on maintaining the number of employees, as much as possible by redistributing the company’s workforce, so as to allow it to restore the production of electrolytic aluminum in 2023, at the previous level, in a smooth and efficient manner.
In order to mitigate the impact on the turnover of the temporary shutdown of the production of the three electrolysis halls, Alro is currently buying cold primary metal from the market. In this way, the company intends to maintain or even increase the production of processed products, while for the less profitable primary aluminum products, the production will be adjusted.
Thus, Alro’s management estimates that the turnover for 2022 will remain at least at the level of 2021, the production plan adopted being the best solution for the current market conditions.