Tight margins spark secondary aluminum cuts

Sep 06, 2012 | 04:10 PM | Daniel Fitzgerald

Tags  Bermco Aluminum, Bob Hollabaugh, Imperial Alloys, Aaron Stankewicz, Spectro Alloys, Superior Aluminum Alloys, furnace shutdown, idled production aluminum

NEW YORK — Bermco Aluminum has idled production capacity at its secondary aluminum smelter, while Imperial Alloys Corp. is coming off a reduced production schedule.

Both companies cited tight profit margins caused by a decoupling of scrap purchasing prices and alloy sales tags for their decisions.

Birmingham, Ala.-based Bermco has idled a furnace representing some 5 million to 6 million pounds of monthly production, or roughly one-quarter of the site’s total capacity, head of sales Bob Hollabaugh said, adding that the company still has two other furnaces running.

Bermco will consider restarting the idled furnace "if things pick up" in the fourth quarter, Hollabaugh said.

"The primary motivating factor is that we’re not going to chase the low-margin and no-margin business. ... Scrap prices are getting out of control. There’s no margin to be had with alloy prices being stuck where they are," he said.....

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