London 11/02/2016 - Russian aluminium company UC Rusal is considering cutting 200,000 tonnes of aluminium production amid a rout in metal prices, it said in its financial results on Thursday.
As well, the company does not plan on restarting its smelters idled in 2013.
Aluminium prices have come under considerable pressure of late, slumping to their cheapest since 2009 below $1,500 per tonne. In the fourth quarter of 2015, Rual's realised price for aluminium fell 6.2 percent to $1,729 per tonne.
Last year, Rusal aluminium production was flat at 3.603 million tonnes compared with 2014.
Around one million tonnes of aluminium was cut in 2015 ex-China and a further 500,000 tonnes are expected to be cut in the first quarter of 2016, maintaining a strong two-million-tonne deficit during 2016-2020, Rusal said. The company expects a 1.2-million-tonne deficit in 2016.
It expects prices and premiums to stabilise in 2016 from current levels due to production curtailments.
The upside to the all-in aluminium price in the short-term will be dependent on FX rates, energy costs, and the positioning of commodity funds based on their views of the Chinese economy, it said.