Alcoa to Restart Third Potline at Warrick Smelter by End of 2018

SEATTLE (Scrap Monster): Alcoa Corporation, a global leader in bauxite, alumina an aluminum products has announced that it expects to complete the restart of the third potline at Warrick Operations in Indiana by the end of the current year. The update was provided while declaring the results for second quarter of 2018. The company had restarted other two potlines during Q2 this year.

The costs to restart the line, estimated at around $5 million, will be incurred in Q3 and Q4 of 2018. The restart of the third potline will lift the annual operating capacity of the Warrick smelter operations to approximately 161,000 metric tons.

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The company’s Q2 results reflected continued strong pricing for both alumina and aluminum. Alcoa reported net income of $75 million, or $0.39 per share, compared to $150 million, or $0.80 per share, in first quarter 2018. The adjusted net income during the quarter surged higher significantly by 97% over the previous quarter to $286 million, or $1.52 per share. The company’s adjusted EBITDA excluding special items was up by 38% from Q1 2018 to $904 million. The quarterly revenues surged higher by 16% to $3.6 billion, aided by higher realized alumina and aluminum prices and increased primary aluminum shipments.

In its outlook for 2018, Alcoa projects global deficit for both aluminum and alumina. Also, it forecasts surplus for bauxite. The projected aluminum deficit has been raised from last quarter’s estimate of 600,000-1 million metric tons to between 1.1 million and 1.5 million metric tons. The global aluminum demand growth estimate has been kept unchanged at 4.25-5.25% in 2018. Alumina deficit is projected between 200,000-1 million metric tons. The stockpile growth in China coupled with increased exports from Guinea is likely to deliver surplus bauxite market in 2018.