Century sees supply headwinds continuing to reduce global aluminum inventories

Jesse Gary, CEO of Century Aluminum, stated in a quarterly conference call that unfavorable supply factors are expected to continue to reduce global aluminum inventory in the short term. Once demand conditions improve, regional aluminum premiums and LME aluminum prices will quickly respond.

Gary stated on Monday during a conference call that as the second quarter enters, global aluminum supply and demand are roughly balanced, with further production cuts by smelters in Europe and Yunnan offsetting the impact of restarting production by smelters in other regions of China.

Gary said that since the beginning of the European energy crisis, Europe has cut 1.2 million tons of smelting capacity, accounting for 50% of the EU’s total capacity. He stated that given the expected further increase in EU energy prices, there is a risk that Europe will cut another 250000 to 500000 tons of aluminum production capacity in the next 12 months.