Gas Week

EWN Publishing

Alcoa to shed 194 jobs, bringing end to aluminium foil manufacturing in Aus: cites high $A, low-cost China

Posted by gasweek on 10 October, 2007

Alcoa would shed 194 jobs, the bulk of which would be lost when it shut its aluminium foil and coil plant at its Yennora site in western Sydney, wrote Andrew Trounson in The Australian (28/9/2007, p.2).

Flipside to resources boom: The knock-on affect would force Alcoa to cut back aluminium ingot production at its Point Henry metal-making operations in Geelong, with the loss of 56 jobs. In the flipside to the resources boom, manufacturing was being increasingly moved offshore as companies battled strong compe­tition from low-cost China, while the boom-fuelled rise of the Australian dollar was making imports cheaper.

End of foil in Aus: The Alcoa shutdown would bring to an end aluminium foil manufacturing in Australia and put the squeeze on Alcoa’s major customer, Confoil, a Melbourne-based packaging company that had about 85 per cent of the local market for foil box-food packaging. Confoil would now have to rely on imports from Europe to supply foil packaging to the likes of Qantas, frozen food manufacturer Sara Lee, and takeaway food outlets. Confoil would now source its foil from mills in Greece, Italy and Germany, increasing its lead time for supplies from 7-10 days to about 13 weeks; this would require it to carry significantly larger inventories.

Other branches not affected: The foil operation at Yennora would close at the end of the year, and ingot production at Point Henry would be cut back from next April. Alcoa said it remained com­mitted to its other rolled prod­uct operations at Point Henry and Yennora, and that the aluminium smelting operations at Point Henry were unaffected.

The Australian, 28/9/2007, p. 2

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