UC RUSAL posts first production report

UC RUSAL, the aluminium giant created by the merger of Russia's two producers RusAl and SUAL and the aluminium interests of Swiss trade house Glencore, has posted its first production report covering the first quarter of this year.

Bauxite Hit

Group production of bauxite was 4.128 million tonnes in Q1 2007, representing a decline of 8.6% from pro forma production of 4.516 million tonnes in the year-earlier period.

The company attributed the 388,244t year-on-year shortfall to production problems in Guinea and at the Middle Timan bauxite operations in the Russian republic of Komi.

Production in the West African country of Guinea was disrupted in the period by an 18-day general strike in January and then by the imposition of a state of emergency in February. Political unrest in the country has since died down after embattled president Lansana Conte acceded to a key demand by unions and appointed a politically neutral prime minister.

Lower bauxite production, however, doesn't seem to have made much of an impact on UC RUSAL's alumina production, which rose by 0.2% to 2.740 million tonnes in the period.

Aluminium Output Rising

Group aluminium production was 999,415t in the first quarter, up 2.5% on 974,378t in the year-earlier period.

The company gave no detailed breakdown but it's a fair bet the increase reflected the impact of the ramp-up of the new Khakas smelter, formerly owned by RUSAL. The first potline at the 300,000tpy plant came on stream at the end of 2006 and the smelter will be gradually ramped up to full-capacity production over the course of this year.

Its impact is also evidenced by the figures from Russian consultancy Aluminiy, which showed national production (excluding Glencore's Swedish smelter) growing by 2.9% over the first quarter. That growth rate has accelerated for three successive months and compares with production growth of 1.9% over calendar 2006, when higher production was a function purely of capacity creep through technology upgrades across the Russian smelter network.

In line with UC RUSAL's stated policy of aggressively growing the downstream products business, output of casthouse products grew by 12.5% year-on-year in Q1 2007 and at 482,341t in the period accounted for 48% of primary metal output.