CHICAGO Century Aluminum
Co. could continue to operate its Hawesville, Ky., smelter even
if it were to lose the facilitys largest customer,
Southwire Co., according to company president and chief
executive officer Michael Bless.
The Monterey, Calif.-based
aluminum producer has been in touch regularly with the
Carrollton, Ga.-based wire and cable producer, Bless said,
referring to the possibility of the Hawesville smelter closing
and Century terminating its supply contract with
amm.com, April 17).
Century announced plans to idle its Hawesville smelter Aug. 20
unless it could secure a better power deal with power supplier
Big Rivers Electric Corp., Henderson, Ky. Century, which gave
Big Rivers a 12-month power termination notice for the
Hawesville smelter last August (
amm.com, Aug. 20), said April 29 it had reached a
tentative power agreement for the smelter. The agreement
remains subject to third-party approvals, including from the
Kentucky Public Service Commission and the Rural Utilities
Southwire, which has a facility
adjacent to Centurys Hawesville smelter, indicated that
it hah contingency plans should Century close the
amm.com, April 18).
Century is confident that it could "sell every ton we produce
at Hawesville" even without Southwire, Bless said.
Baar, Switzerland-based Glencore
International Plc also could be impacted by Hawesvilles
closure, Bless said. Century has a "sweep contract" under which
Glencore takes whatever free metal Hawesville produces. "If
there were no metal, there is no obligation," he said.
Asked by Bank of America Merrill
Lynch senior research analyst Timna Tanners whether Hawesville
has been "loss-making," Bless conceded that it has been.
However, he stressed that Century did not see the facility
primarily in those terms. "It would be devastating to us if we
had to close that plant for a whole host of reasons," he said,
noting the "broad and deep" talent at the plant.
Bless noted that there had been
"a tick up in incidents" at Hawesville in January, with
production volumes at the facility slipping during the first
quarter because of "six to seven" pot failuresmore than
Century had anticipated. "We are through that now and
were back to a full pot complement," he said.