Energy costs rise an aluminum smelter in northern France will cut production by 15%

A spokesman for, American Industrial Partners (AIP) said on Friday that a major aluminium smelter in northern France would cut production by 15 per cent to cope with soaring electricity prices.

The smelter in Dunkirk, which has an annual capacity of about 285000 tons, has cut production by 10 per cent and will cut production by a further 5 per cent next week, the spokesman said.

The smelter in Dunkirk is one of several smelters in Europe that have cut production since last month. Profits in aluminium smelting, an energy-intensive industry, have been hit by the surge in electricity prices to record highs.

The spokesman declined to comment on the possibility of further production cuts. Laurent Geeraert, a senior member of the smelter's federation of trade unions, told local radio stations that if electricity prices did not fall, the share of production cuts could increase to 25 per cent.

Dunkirk aluminium smelter is one of the big energy users in discussions with the French government and EDF, the country's state-owned nuclear network operator, over relief measures. About 60 per cent of the smelter's electricity supply is subject to preferential price mechanisms, but the remaining 40 per cent follow market prices.

The French finance minister said on Friday that he was working to find further measures to curb the rise in electricity prices, and that the government had taken note of the burden on consumers.

Private equity firm AIP acquired the Dunkirk smelter last year.