One of the world’s dominant aluminium producers, Rio Tinto Ltd (ASX & LSE: RIO) is planning to boost the price of aluminium.
The company is looking to get a greater payback from the Canadian smelters it acquired in the 2007 $US37 billion takeover of Alcan – a buy that put the company in financial stress and eventually led to the departure of Tom Albanese as chief executive.
Metals writer for The Australian newspaper, Matt Chambers said the argument for a greater price for its Canadian aluminium was that it was produced with hydro power generation.
So is the Rio controlled Tiwai Point smelter in New Zealand which gets the bulk of its power from the Manipouri hydro power scheme, with the balance coming now from a mix of other power generators utilising renewable energy.
Chambers said that in 2016 Rio Tinto branded its low-carbon aluminium as RenewAL with a guarantee that fewer than four tonnes of carbon dioxide were emitted for every tonne of metal produced – about one-third of the industry average.
Rio Tinto’s aluminium chief Alf Barrios told Chambers that electric cars will consume greater amounts of aluminium, with a factor being vehicles would become lighter.
In Australasia, Rio has the coal-fired Boyne and Tomago smelters in Queensland and New South Wales and the hydro-powered Bell Bay in Tasmania, as well as Tiwai Point at Bluff. These are all part of Pacific Aluminium for which there has been a “for sale” shingle put out again.