Norwegian Aluminum Company Norsk Hydro saw its shares slump as much as 3.8 percent, the biggest decline since March 3 after announcing lower-than-expected earnings earlier this week. Net income was 185 million kroner ($30 million), less than half the 378.5 million-kroner average estimate of four analysts surveyed by Bloomberg. The Oslo-based company reported a loss of 637 million kroner last year.
Seasonally lower prices and output from its hydroelectric business weighed on underlying results, while this was partly offset by higher metals prices, the company said in a statement. Global demand for aluminum, excluding China, rose 4 percent in the quarter from a year earlier. Consumption rose to 27.5 million metric tons, while production was 26 million tons.
Norsk Hydro has been cutting high-cost primary smelting operations as aluminum prices declined to a five-year low in February, Bloomberg News reported. The company is investing to increase production of alloys used to make goods from computers and smartphones to lightweight cars. It’s spending 130 million euros to expand capacity fourfold to 200,000 tons a year at its Grevenbroich plant in Germany to meet demand from carmakers.
Rising 1.7 percent to close at $2,020 per metric ton, the aluminum cash price experienced the biggest change on the LME for Wednesday, July 23. On the LME, the aluminum 3-month price rose 1.6 percent to $2,038 per metric ton. The cash price of primary Indian aluminum inched up 0.4 percent to INR 123.10 ($2.05) per kilogram.
Chinese aluminum prices closed flat for the day. For the fifth day in a row, the price of Chinese aluminum scrap remained essentially flat at CNY 12,250 ($1,975) per metric ton. The price of Chinese aluminum billet was unchanged at CNY 13,590 ($2,191) per metric ton. For the fifth consecutive day, the price of Chinese aluminum bar held flat at CNY 14,200 ($2,289) per metric ton. The cash price of Chinese aluminum saw essentially no change for the fifth day in a row, remaining around CNY 13,450 ($2,168) per metric ton.