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Wednesday, January 13, 2010
Today's News Headlines
* Alucasa output expected to drop 40% due to Alcasa line closure - Venezuela
* Specialty steels distributor expecting strong Q1 - Brazil
* MEM sees Doe Run agreement with concentrate providers by month-end - Peru
* Alcasa workers to study options for replacing lines 1 and 2 - Venezuela
* NWA tests red mud in road construction, repairs - Jamaica
* IN BRIEF Gold slips for first time this year, closes at US$1,151/oz on LBM - Regional
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* Alucasa output expected to drop 40% due to Alcasa line closure - Venezuela
Output at Venezuelan state aluminum products company Aluminios Carabobo (Alucasa) could drop by 40% because of the production lines that were shut down at aluminum reducer Alcasa, a Sintraluminio union official told BNamericas.
"Alcasa is Alucasa's main raw materials supplier and now that two of its production lines have been closed it won't be able to provide the needed aluminum," the official said.
The closure will significantly lower the 1,000t/m of aluminum that Alucasa had been receiving. "Now only about 600t will be coming in, which will seriously reduce production levels," the union representative said.
Both Alucasa and Alcasa are controlled by state heavy industry holding company CVG.
In December the Venezuelan basic industry and mining ministry (Mibam) lowered the power supply available at state industry plants in the Guayana region, and Alcasa had to shut down production lines 1 and 2 as part of the procedure.
According to reports, in November and December Alucasa produced 1,300t of thinly rolled aluminum products.
In October Alucasa was operating at less than 40% of its capacity due to a lack of investments in technology, and workers petitioned the government to provide a rescue plan in order to avoid a deeper crisis and subsequent closing.
The Alucasa plant has installed capacity of 23,000t/y and as of October was producing at a rate of only 700t/m out of its 1,800t/m capacity.
By Harvey Beltrán
Business News Americas
* Specialty steels distributor expecting strong Q1 - Brazil
Brazilian specialty steels distributor GGD Metals is expecting a booming first quarter propelled by strong sales to the automobile and appliances sectors and a significant recovery in the heavy machinery market, company CEO André Dias told BNamericas.
"We are going through a period of euphoria right now," Dias said. "The trend is for sales in the machinery and equipment sector to heat up again after an extremely bad year in 2009."
Traditionally, he said, the automobile and equipment sectors go hand-in-hand.
Dias sees GGD Metals' revenues rising 60% in 2010 versus 2009, when they came in at 110mn reais (US$63.3mn).
He also sees growth of 15% in 2010 in the equipment industry.
Overall, the executive forecasts an extremely strong domestic market in 2010, very different from one year ago.
Dias said that products currently in high demand are molds and matrixes, used in plastic and aluminum injections. He also sees high growth in domestic infrastructure projects such as hydroelectric plants and wind farms.
"I have the impression numerous projects were interrupted due to the crisis and now are beginning to come back," Dias said.
By Claudio Mendonça
Business News Americas
* MEM sees Doe Run agreement with concentrate providers by month-end - Peru
Peru's energy and mines ministry says it is confident that Doe Run Perú, which owns the halted La Oroya smelter in Junín, will reach an agreement with its concentrate providers by end-January.
The company was recently reported to be unable to meet the January 31 deadline for restarting the operation, the first in a 30-month timeline for getting the decades-old smelter running, financed and in line with environmental obligations.
The idea is that once the smelter is running, it will have cash flow to help sustain operations and obtain credit. In the meantime, workers have agreed to take a 50% pay cut until end-January to help the company restart the smelter, according to state news agency Andina.
"I am confident that by month-end the company will at least present an agreement with the providers," said deputy mining minister Fernando Gala in a statement from the ministry.
La Oroya produces 11 different metals and is known for having caused serious lead contamination around the town of La Oroya.
By Business News Americas staff reporters
* Alcasa workers to study options for replacing lines 1 and 2 - Venezuela
The Venezuelan basic industry and mining ministry (Mibam) has submitted financial and feasiblity studies to workers at aluminum reducer [1]Alcasa[/*1], where production lines 1 and 2 where recently shut down, for projects that could help replace the idled lines, the company said in a statement.
The studies were given to the worker committees that were created as a way of cooperating with the shutting down of production lines 1 and 2 in order to comply with a government plan to conserve energy.
Alcasa began the process of shutting down the two lines last month.
Mibam head Rodolfo Sanz stressed the importance of worker participation in validating and carrying out these projects since "we don't want this to be something that was imposed by Mibam or [state heavy industry holding company] CVG."
CVG controls 92% of Alcasa and the remainder is held by US aluminum producer Alcoa (NYSE: AA). Alcasa is located in Puerto Ordaz and has capacity of 210,000t/y.
By Business News Americas staff reporters
* NWA tests red mud in road construction, repairs - Jamaica
Jamaica's National Works Agency (NWA) is investigating using the red mud generated as a by-product of alumina production in the construction of roads, government information service JIS reported.
NWA has already advanced in the research process and will start a pilot phase in St Elizabeth parish to test the material. This phase is expected to end by April and, if successful, could result in savings on road construction and repairs.
Research so far shows that the mud can be stabilized using geopolymers. "Geopolymers are some complex polymers (compounds) of aluminum silicates that you mix with the red mud and it stabilizes the red mud. It is really cutting-edge technology," Vivian Blair, engineer in charge of materials and soil research at NWA, was quoted as saying.
By Business News Americas staff reporters
* IN BRIEF Gold slips for first time this year, closes at US$1,151/oz on LBM - Regional
The price of gold trading on the London Bullion Market (LBM) slipped for the first time so far this year on Tuesday when it closed at US$1,151/oz, compared to US$1,153/oz the trading day before.
The US dollar, whose recent weakness had been propelling gold prices continuously higher since the start of the year, recovered some ground Tuesday against the euro and other currencies.
By Business News Americas staff reporters
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In-deph interview
* "It's sad to say this but scrap collectors, who gather inputs for the steel industry, are being pushed aside"
José Arévalo Jr
President
Cofarja
Brazil
http://www.bnamericas.com/interviews/metals/Jose_Arevalo_Jr_,Cofarja,/169679514
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Main companies covered in today's news
* ALFA S.A.B. de C.V.
http://www.bnamericas.com/company-profile/en/ALFA_S,A,B,_de_C,V,-ALFA/169679514
* C.V.G. Aluminio del Caroni S.A.
http://www.bnamericas.com/company-profile/en/C,V,G,_Aluminio_del_Caroni_S,A,-Alcasa/169679514
* Doe Run Perú
http://www.bnamericas.com/company-profile/en/Doe_Run_Peru-Doe_Run_Peru/169679514
* Worldsteel Association
http://www.bnamericas.com/company-profile/en/Worldsteel_Association-Worldsteel/169679514
* Lupatech S.A.
http://www.bnamericas.com/company-profile/en/Lupatech_S,A,-Lupatech/169679514
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