Rusal plans to cut aluminum output by 250,000 tonnes amid decision to optimize capacity

MOSCOW. Nov 25 (Interfax) - Rusal has decided to optimize capacity of aluminum production amid record prices for alumina and the high risks that negative macroeconomic conditions could continue, the company said in a press release.

The first stage of the optimization program envisages cutting aluminum output by 250,000 tonnes.

Rusal has said that the reduction results from being forced to purchase over one third of the required alumina on global markets at exchange prices, thereby seriously pressuring the production margin.

"Alumina prices have nearly doubled to more than $700 per tonne since the beginning of 2024, demonstrating record growth rates. Consequently, the cost of alumina is over 50% of the cost of aluminum versus the usual level of 30%-35%," Rusal said.

"The proportional increase in the price of aluminum also does not offset growth in alumina prices amid the ongoing weak macroeconomic situation and surplus supply of metal on the market. Decelerating economic growth and tightening monetary policy has resulted in a decline in output in the leading aluminum-consuming sectors, including construction and auto manufacturing, thereby leading to a decrease in demand for key metals," the company said.

Rusal plans to retain the number of employees working at all production sites, as well as the social programs fully, according to the press release.