Virus halts Century Aluminum potline rebuild; company wants tariffs on Canada


By Dave Taylor

Last Monday the U.S. federal government posted the full findings of its Section 232 study to the Federal Register, an online repository of government documents, and the posting is a reminder of the importance of aluminum to not only the country, but to Hancock County, with Century Aluminum at the center of both.
The study, first made public in 2018 after roughly seven months of research by the U.S. Dept. of Commerce, determined that the survival of the American aluminum industry, and specifically Century Aluminum, was vital to national security, largely because Century is the lone U.S. producer of the aluminum used in military applications. That finding led to tariffs on the foreign aluminum that the government determined was threatening the U.S. industry and led to the restart of most of Century’s idled production capacity.
“Of the five smelters currently in operation at some level, only one is capable of producing high-purity aluminum for many advanced aerospace and defense applications: Century Aluminum’s Hawesville, KY plant,” the report states. “…(It) has demonstrated capability to produce at least 100,000 metric tons of high-purity aluminum a year (it manufactured 60,000 metric tons of high-purity aluminum in 2016).”
The report listed more than 60 military aircraft that use aluminum and reiterated its value to the Department of Defense.

“The use of aluminum has been key to the success of advanced aircraft over the decades, including planes such as the Lockheed SR-71 Blackbird, C-17 Globemaster, Boeing F-18 – and today, the F-35 Joint Strike Fighter,” it says.


Tariffs saved Century, but now the COVID-19 pandemic is weighing down the company.
In its first quarter conference call in April, company president and CEO Mike Bless said that due to a downturn in the market the company has been containing costs by holding off on work at the Hawesville mill.

“We put on hold the vast majority of the capital projects,” he said. “The most significant of these, obviously, is the rebuild of the last potline in Hawesville.”
The company restarted three idled potlines and planned to rebuild the two that had remained in use, with the fourth line rebuild having been completed early this year.
End use customers have also seen a slow down in their markets and they’re not needing the quantity they did just a few months ago, but Bless said the picture isn’t all gloomy.
“We are, however, seeing some good offsets to these trends,” he said. “For example, at Hawesville, (the) plant is producing record amounts of high-purity metal.”

“… This product continues to be required by the military sectors, and we’re really pleased and proud to be doing our part in this regard,” he said. “And importantly, this is a really gratifying confirmation of the success of the technology upgrade at Hawesville and, importantly, of the skills of our largely new workforce there.”
While tariffs saved Century from the effects of government subsidized foreign aluminum imports, some countries, like Canada, were exempted, which Bless said might have to be re-evaluated.

The price of aluminum in the Midwest, or the Midwest Premium, had been falling prior to the coronavirus, down 20 percent, which Bless said correlates to Canada being exempted.
“The fall began very shortly after Canada was exempted from the Section 232 tariffs,” he said.
At the same time, he said, imports of aluminum from there have increased.
“…You’ll see that total primary aluminum imports from Canada are up 30 percent since the exemption. That was last May,” he said. “And more particularly, P1020 imports from Canada are up almost 75 percent since the time of the exemption. This is in stark contrast to the commitment by the Canadians that post-exemption imports would not surge.

“As you’ll remember, at the time of the exemption, the parties agreed that the tariffs would go back into place if a surge were to occur and not to cease,” he said.
President Donald Trump has said he is considering placing tariffs on Canadian aluminum, although the United States-Mexico-Canada Agreement (USMCA) is presumed to alleviate some of those worries. That pact was effective July 1, 2020.
A spokesman for Century Aluminum didn’t reply to media requests for updates on the status of the plant and its employees.

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