As the price of aluminium breaks new records, closing in on $US3000 a tonne, global giant Rio Tinto must be having a quiet chuckle to itself.
Only a year ago it was threatening to close the Tiwai Point aluminium smelter, consigning it to the scrap heap with the loss of 700 jobs, directly, and another 1600 indirectly. For Southland’s economy it would have been a mortal blow.
At that time, aluminium was fetching only $1800 a tonne.
Rio Tinto said the smelter was uneconomic because the price of electricity was too high. In July last year it said it would close the operation because of high costs and a challenging market.
The decision to close the smelter had disappointed politicians and local power firms as it came when the COVID-19 pandemic began to cripple the economy.
Some economists argued NZ should let it go and divert the Manapouri electricity, the cheapest in the country, to other uses. Continue reading “Soaring aluminium prices look likely to encourage Rio Tinto to press for extending its Tiwai Point sweetheart deal”