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Riding the aluminum roller coaster

By Staff | Jan 28, 2009

It’s been over a month since Century Aluminum in Ravenswood announced a possible complete shutdown by Feb. 15 if aluminum prices don’t recover from their nosebleed.

It’s been a shockwave with effects reaching Tyler County.

Precision, Inc., of Sistersville and Aleris Recycling in Friendly have both been forced to layoff workers as the aluminum industry worldwide continues to meltdown.

Precision Vice President Ron Larson reports that after a minor week-long shutdown, their employees are back to work. However, they are only operating with just over half of their original workforce.

“The maintenance shutdown ended Jan. 11, and employees returned to work on January 12, 2009,” said Larson. “In late December we announced a layoff of 17 people bringing us to currently 21 employed at our West Virginia facility.”

Precision’s shut down followed recent news about Century Aluminum of West Virginia, which has shut down one potline at its Ravenswood plant and is considering halting all production because of slumping prices.

Century notified workers of the potential shutdown Dec. 17. Federal law requires employers to provide notice 60 days in advance of plant closings and mass layoffs. The plant would cease operations beginning Feb. 15 if aluminum prices don’t stabilize and the company can’t reduce monthly costs.

The shutdown of one potline reduced production by about 3,540 tons per month. The shutdown was completed by Dec. 20 and about 120 workers were temporarily moved to other plant operations. The plant employs 685 workers.

“As stated previously, Century is a valued customer of Precision’s,” stated Larson. “In the past Precision has supplied Century with many of their operational items. We are hopeful that a solution is found to keep the plant open and operating.”

Despite being a large supplier to Century, Larson says the end of Century doesn’t necessarily spell the end for Precision.

“Precision will continue to operate and serve our other customers,” said Larson. “We are a metals fabrication and welding shop and are constantly looking for new opportunities to work with customers in other market arenas such as chemical, power, transportation, and mining.”

Precision isn’t the only plant in Tyler County that is being affected by the volatile aluminum market. Aleris operates a aluminum recycling plant in Friendly. Aleris Human Resources Director Melissa Olmstead says the Friendly recycling plant hasn’t been immune.

“Clearly this is a challenging time for our industry and for the economy as a whole,” said Olmstead. “Aleris has felt the impact of the global recession and we have responded in a number of ways, including reducing our costs through temporary and permanent layoffs at our facilities. On December 18, 2008, we announced a temporary layoff of 49 employees at our operating facilities in Friendly, WV. Prior to the layoff, we had approximately 95 employees in both facilities.”

Aleris International, Inc. is a global leader in aluminum rolled products and extrusions, aluminum recycling and specification alloy production. Headquartered in Beachwood, Ohio, a suburb of Cleveland, the company operates over 40 production facilities in North America, Europe, South America and Asia, and employs over 8,000 employees.

“As for your remaining questions, because Aleris files financial documents publicly with the SEC, I am unable to comment beyond our initial statement at this time,” stated Olmstead.

The global recession and lack of demand for aluminum already have dropped prices on the London Metal Exchange (LME) for January to 66 cents; the lowest monthly price since April 2003.

For the moment, the aluminum industry can only watch as the roller coaster continues on.