Noranda Plan Temporary Shutdown of Magnesium Plant

Noranda have announced plans to rationalise their magnesium business in response to changes that have taken place in the magnesium market. The proposed changes are expected to improve cash flow by about $100million.

Noranda intend to temporarily shut down their Magnola plant in Canada until such times as the magnesium price increases or there is financial justification to restart production there. To this end they have begun talks with Societe generale de financement du Quebec who own 20% of the plant.

They are also looking into the possibility of continuing to operate the cast house operation of the plant to produce magnesium alloys using metal sourced externally.

The proposed shutdown, if approved will take place before the end of the first quarter and is estimated to last for a year, but is dependent on magnesium prices.

Magnesium prices have been driven downwards by cheap Chinese production. Chinese producers now supply 50% of the worlds requirements.

For more information on magnesium, click here.