In response to reduced market demand for aluminium billets in Europe, Hydro has decided to partially curtail aluminium production at Hydro Karmøy and Hydro Husnes in Norway.
The decision will correspond to an annual production capacity reduction of 110,000-130,000 tonnes of primary aluminium, including production recently taken out for ordinary maintenance and not yet restarted.
"The extraordinary situation in the European economy and energy market is causing market uncertainty and a decline in demand for our aluminium products. Even if 50 percent of Europe's primary aluminium production capacity has been curtailed during the last year, recent drop in demand is causing a buildup of stock, forcing us to take firm actions," says Eivind Kallevik, Executive Vice President and Head of Hydro Aluminium Metal.
In July, Hydro guided about uncertain markets and implemented mitigating actions to adapt to the market situation. The new measures at the Norwegian aluminium smelters comes in addition to the closure of the majority owned primary aluminium plant, Slovalco in Slovakia at the end of August. The decision to partially curtail Hydro Karmøy and Hydro Husnes will not affect manning level at the respective plants.
"While the short-term market trend is falling and uncertainty prevails, underlying market trends longer-term will remain positive due to the rising need for aluminium in support of the European green transition. We believe that with Norway's strong industry framework conditions, including access to renewable energy, Hydro's Norwegian aluminium smelters are well positioned to capture the growing market for low-carbon aluminium. We will use the temporary curtailments and somewhat reduced activity levels to bring forward planned investments to develop the plants for future demand growth," says Kallevik.
The process to curtail production will start shortly and it is expected that Hydro Husnes and Hydro Karmøy will reach the new production levels by the end of 2022.
The curtailment will lead to a reduction in power consumption amounting to a total of around 170-200 MW once curtailment is in full effect.
Investor contact:
Line Haugetraa
+47 41406376
Line.Haugetraa@hydro.com
Media contact:
Halvor Molland
+47 92979797
Halvor.Molland@hydro.com
The information is such that Hydro is required to disclose in accordance with the EU Market Abuse Regulation. The information was submitted for publication from Hydro Investor Relations and the contact persons set out above.
This information is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act.
