RusAl plans large investment projects

The international aluminum market saw hard times this year. Prices foraluminum did not surpass $1,400 per ton and analysts forecast excessivesupplies of aluminum in 2003. However, despite the current marketsituation, Russian aluminum giant RusAl (Russian Aluminum) is planningproduction growth and large investment projects. RusAl General DirectorAlexander Bulygin commented on the company's strategy over the next severalyears in an interview with the Nezavisimaya Gazeta newspaper.He explained that investment plans of RusAl were based on long-termtendencies and perspectives. In addition, the company was taking intoaccount reports from investment firms and average data over the past tenyears. According to the latter, the average annual price of aluminum was$1,450 per ton. The director also stated that if it took three years toconstruct a factory than forecasts for the next four years should be takeninto account instead of the current situation on the aluminum market. Healso stated that a rise in aluminum consumption was 2.5-3 percent a year.The total volume of aluminum production in the world was about 21m tonsseveral years ago and by now this figure reached 25m tons. With a rise inaluminum consumption over the next ten years, factories with a totalcapacity of 7.5-8m tons are expected to be constructed throughout theworld. Therefore, if RusAl wants to preserve its position on the worldmarket, it should construct factories with a total capacity of 750-800,000tons.The RusAl head noted their plans included both the construction of newfactories and the expansion of existing ones. In particular, the company isgoing to start the construction of the second part of the Sayany aluminumfactory in the first quarter of 2003 and build a factory in the Irkutskregion with a capacity of 500,000 tons..

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