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Hydro to Increase Foundry Alloy Supply +50%

July 25, 2007
Sale of castings operations is part of new primary metal strategy

Oslo-based Hydro Aluminium plans to increase its global foundry alloy supply to 350,000 metric tons this year, from 230,000 metric tons in 2006, the company recently announced.

Until late last year, Hydro boasted of being the world's largest independent producer of automotive engine blocks, but it recently sold those operations to Nemak. (Its share of a Mexican engine-block joint venture was sold to its former partner, Grupo Industrial Saltillo.) Hydro also discontinued primary magnesium production, which had been focused on serving the diecasting market.

Speaking last month in Dsseldorf, Germany, Torstein Dale Sjtveit, Hydro's exec. v.p. for Aluminium Metal stated, "We will continue our strategy to increase efficient upstream capacities, making our primary portfolio more competitive."

Hydro had long been organized as a conglomerate of oil and natural gas, light metals, and agri-chemicals. The latter business area was spun off in 2005, and the oil/gas holdings have been sold to Norway's state-controlled oil company. "Following the planned merger of Hydro's oil and gas activities with Statoil this coming fall, Hydro will concentrate its efforts on aluminum and power, with the financial muscles to grow further," said Sjtveit.

Hydro says it intends to continue modernizing and expanding its primary aluminum operations, in part as a way to extend customer service and technical support. Last week, Hydro gained final approval for a 585,000-metric tons/year smelter to be built in Qatar, a joint venture with Qatar Petroleum starting up in 2009.

"As a start, we remain close to the market, also when it develops, as with the new casting lines at Sunndal in Norway and at our 55%-owned metal plant Slovalco in the heart of emerging Central European industries. In 2010, our planned project in Qatar will come on stream, and add significantly to global capacity," Sjtveit stated.

Anticipating greater customer demand, Hydro has updated its online portal, so customers can track and print order specifications. It also promotes visits by its technicians to customers' plant sites and labs, to offer insights into metallurgy and casting, to raise efficiency and effectiveness.