SEPT. 27 2016 (The Conway Bulletin) – TALCO, Tajikistan’s aluminium smelter and the country’s biggest industrial asset, should cut output to survive because aluminium prices have fallen below production costs, the company auditors said.
Tajikistan’s government has repeatedly intervened to give TALCO incentives and preferential loans but has not been able to prevent thousands of job losses.
Now production cuts are likely.
“This year, a significant decrease in the level of world prices for aluminium has impacted TALCO’s earnings. The company auditors have suggested that the management orders a cut in production in order to keep financial losses at a minimum,” TALCO said in a statement.
TALCO produced over 73,000 tonnes of aluminium in the first half of 2016, a 13.5% increase compared to the same period last year. It exports to clients in Turkey, Taiwan, Iran, British Virgin Islands, Uzbekistan and Pakistan.
Low commodity prices, though, meant it sold aluminium at a price range of $1,400-$1,600/tonne. Production costs have reached $2,000/tonne. In April, it laid off around 600 workers to cut costs.
ENDS
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(News report from Issue No. 298, published on Sept. 30 2016)