CRU aluminum: Canada rail shutdown, M&A, and more

Miners Rio Tinto and Teck Resources are taking a series of measures to mitigate the impact of Canada’s two largest railway companies shutting down their networks during a labor dispute.

Rio Tinto said it will truck some materials and products, and increase the use of its own rail network, primarily 400 km serving its iron ore operations in Quebec, as well as Newfoundland and Labrador, and around 100 km for its aluminum business. The labor dispute between Canada’s two largest railway companies and their workers is expected to disrupt operations, prompting miners to implement measures to minimize the impact.

Teck stated it is looking to use alternative transportation, with a spokesperson for the Vancouver-based base metal miner adding that interruption of rail services is negative for its partners and customers in the critical minerals supply chain.

Normal rail services in the vast country were suspended on Aug. 22 after operators Canadian National Railway and Canadian Pacific Kansas City locked out more than 9,000 unionized workers. The Mining Association of Canada said it is seriously concerned about the damage the development may cause.

“As the single largest industrial customer group of Canada’s railways, the mining sector has seen first-hand how detrimental unpredictable work stoppages are to Canada’s reputation as a reliable trading partner,” said association president and CEO Pierre Gratton, before adding: “The urgent need for Canadian minerals and metals presents a generational opportunity, and we are in a race with our competitors to meet global demand. A first-ever, simultaneous halt in … rail service could not come at a worse time.”

The association said rail freight volume in 2022 was 283.6 million metric tons (mt), 132 million mt of which was crude minerals and 28.3 million mt processed mineral products, together accounting for 56% of the total.

EGA to acquire majority stake in US recycling firm Spectro Alloys

EGA announced its intention to acquire a majority stake in American aluminum recycling firm Spectro Alloys Corp. The acquisition, which is subject to obtaining regulatory approvals, will accelerate EGA’s global expansion into aluminum recycling and expand EGA’s business in the US.

Spectro Alloys is a leading secondary foundry alloy producer in the US, founded in 1973, and based in Rosemount, Minn. The company has a production capacity of around 110,000 mt/y of aluminum ingots, with a carbon intensity of less than 1 mt of CO2 equivalent per mt of aluminum produced. Earlier this year, Spectro Alloys broke ground on an expansion project at its Rosemount site that will add approximately 55,000 mt/y of secondary billet production capacity in the first phase, which is expected to be completed in 2025.

EGA intends to acquire 80% of Spectro Alloys. The current owner-managers will retain a 20% interest. EGA and Spectro Alloys have signed an equity purchase agreement, and the transaction is expected to close during the third quarter of 2024.

Hindalco to invest $10 bn in major expansions plans across India and the US

India’s Hindalco Industries is set to undertake a significant expansion with investments totaling $10 billion, said Chairman Kumar Mangalam Birla at the company’s annual general meeting on Aug. 22. Birla outlined plans for ongoing and near-term projects, including expansions in aluminum and copper smelters, the Aditya flat-rolled product plant, a new alumina refinery in Rayagada, and Novelis Bay Minnette, Ala., expansion.

Hindalco is considering a brownfield expansion of approximately 200,000 mt/y at its aluminum smelter in Odisha, with a significant portion of the power requirements to be met through renewable energy sources, Birla said in his speech. In addition to its aluminum initiatives, the company is planning to expand its copper smelting capacity and is exploring the establishment of a brownfield facility in Gujarat to address the rising demand for this metal in India.

Finally, Birla stressed the strategic investment in its subsidiary Novelis and its rolling and recycling project in Bay Minette, Ala., which is well set to become one of the most advanced and automated plants in the industry.

Novelis celebrates major milestone in green investments

Atlanta-based Novelis announced this week the successful completion of its Green Bond financial commitments. In the third Green Bond report, the flat-rolled aluminum producer shares how these investments are driving innovation and helping the company achieve its goals for reducing carbon emissions, energy use, water use, and landfill waste.

In the report, Novelis asserts that an amount equal to the total net proceeds of $588 million from the March 31, 2021, issuance of the €500 million, 3.375% Senior Notes due April 15, 2029, have been used to finance new or existing Renewable Energy and Pollution Prevention & Control projects in the 36 months prior to the issuance through Sept. 30, 2023.

“Although we’ve met the spend commitment of our Green Bond, our commitment to sustainability is never ending,” said Steve Fisher, president and CEO of Novelis. “We are aiming for a carbon-neutral future for aluminum – built on a global, circular economy – and every day we innovate and collaborate with our customers to move us closer to that future.”

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