Alcoa May Mothball Production Capacity

America's aluminum manufacturing capacity could be set to take a big hit.

On Wednesday, aluminum giant Alcoa (NYSE: AA  ) announced plans to review 460,000 metric tons of smelting capacity over the next 15 months, with an eye to "possible curtailment" of its production. Older, higher-cost plants will receive special attention "due to factors such as energy costs or regulatory uncertainty."

The company explains the move is necessitated by the fact that aluminum prices have declined by more than a third since peaking in 2011.

Alcoa has already idled 13% of its production capacity -- 568,000 metric tons -- over these concerns. Additional plant mothballings, closures, or sales now threaten an additional 460,000 tons, or an amount exceeding the production capacity of all wholly owned U.S. plants at rival Century Aluminum.


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