At America's Last Alumina Refinery, A Trade War Spells Trade-Offs

SEATTLE (Scrap Monster): President Donald Trump wants to reinvigorate American industry with tariffs on metals, cars and dozens of foreign exporters. In Gramercy, Louisiana, home to the nation’s last refiner of the key material for making aluminum, locals aren’t sold on joining any such revival.

“It would be a good thing to go out of business,” Barbara Dumas, 58, said of the plant she’s lived across the river from for 15 years. Like many residents, she bemoans the area’s industrial pollution and believes her community would be better off without the refinery. “It may hurt the people that’s working there, but at least people around here can live safer.”

Atlantic Alumina, also called Atalco, became the last U.S. refinery of its kind after another one 20 miles away closed in 2020. On the banks of the Mississippi River halfway between New Orleans and Baton Rouge, Atalco’s 550 workers crush, wash and heat Jamaican-mined bauxite in a series of solutions. What starts as a rust-colored rock comes out as powdery white aluminum oxide, a compound known as alumina that resembles sugar but whose granules are hard enough to scratch glass.

The product is sold to smelters to make “primary” aluminum, the raw material that manufacturers turn into everything from beer cans to plumbing parts. The Atalco plant says it single-handedly supplies about 40% of the alumina used in the United States.

“It’s been a very difficult operation,” said Mark Hansen, the CEO of Concord Resources, which became Atlantic Aluminum’s majority owner in 2021. The complex, first commissioned in 1957, has been pummeled recently by hurricanes and inflation, but Hansen said it’s important to keep the site running for national security.“If our company closed, we would be the only point of failure for that entire industry in the United States,” he said, noting that the sector has seen “a dramatic decline” in the last two decades.

Trump’s 25% tariffs on foreign-made aluminum, which took effect for most countries March 12 alongside comparable duties on steel, aim to reverse that. The sweeping levies he unveiled Wednesday on virtually all imports could prove a mixed bag, spurring demand for domestic wares while raising many producers’ costs.

Still, tariffs could buoy at least some parts of the domestic aluminum industry, analysts say: By making international supplies pricier, the American-made metal should become more competitive for buyers, at least in the short term.

But the new metal tariffs don’t cover alumina, and Hansen said his modest efforts to lobby Washington policymakers haven’t had much success.“It’s not like we’re Coca-Cola or something,” he said. “We don’t get that level of attention.”

A White House spokesperson said the administration expects the aluminum tariffs to increase the nation’s production capacity for the critical metal, adding that its efforts to reduce energy costs and slash regulations would also boost the primary aluminum industry.

After decades of offshoring some of the most energy-intensive parts of the alumina refining process, the United States makes far less of the material than it uses. Smelters, just four of which remain domestically, rely on imports for about 60% of their alumina needs.

Jobs in the primary aluminum sector have plummeted nearly 70% since 2013, the Aluminum Association estimates. Most job growth has been in secondary aluminum, among “downstream” companies like product fabricators and recyclers. The domestic industry can’t continue to expand without foreign-made primary aluminum, said Charles Johnson, the trade group’s CEO.

“We are very encouraged by some of the actions that President Trump has taken as he has entered office,” he said, including the call to ramp up smelting in the U.S., but Johnson said that process could take a decade. Until then, the downstream sector needs access to foreign supplies — especially from Canada, which the Aluminum Association and other industry stakeholders have urged the administration to spare from tariffs even as they cheer duties on China, a top exporter of cheap metals.

Courtesy: www.nbcnews.com