OREANDA-NEWS. On 29 January 2008 UC RUSAL announced its production and summary financial results for 2007.

Highlights*

Revenues increased by over 11% to USD 14.3 billion compared with USD 12.9 billion in 2006 
Overall investment rose by 45%, amounting to USD 2.9 billion
Aluminium production increased by 6% to 4.2 million tonnes
Output of high value-added casthouse products increased by 16% to about 2.1 million tonnes
Alumina production rose by 5.1% to more than 11.3 million tonnes
Bauxite mining production was maintained at 17.3 million tonnes

*Figures for 2006 reflect the combined results of United Company RUSAL, formed through the completion of the merger of RUSAL, SUAL and Glencore’s alumina assets. Figures are preliminary and may be revised following audit completion.

Plans for 2008
This year will not be easy for the aluminium industry. A number of factors are expected to lead to poor conditions for the world aluminium market and an increase of production expenses in 2008. The major impact will be the forecast slowdown of consumer demand in the USA and a possible recession plus the reduced competitiveness of imported products because of the weak US dollar.  These factors will negatively influence domestic demand for aluminium and may lead to lower demand for aluminium from US largest trade partners. In addition, the significant increase in the price of energy resources, in particular oil, will negatively influence the cost of aluminium production throughout 2008, decreasing its profitability. 

On the other hand, China is expected to reduce exports of aluminium in 2008, continue its active urbanization and become a net importer. The increased cost of energy and raw materials, higher construction costs for new aluminium plants, as well as tougher environmental legislation requiring the use of environmentally friendly metals should stimulate the demand and provide new opportunities for aluminium.  Growth of demand for aluminium is expected to be at least 7-8% per annum.

In this situation, one of the company’s top priorities will be further optimization of expenses in order to maintain its position as one of the most effective aluminium companies in the world. Another important priority of the company will be the completion of the acquisition of 25% plus one share of Norilsk Nickel and further efforts to develop the company into one of the world’s largest metals and mining corporations.