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Business Mayor
12-05-2025
- Business
- Business Mayor
The aluminum sector isn't moving to the U.S. despite tariffs — due to one key reason
HAWESVILLE, KY – May 10 Plant workers drive along an aluminum potline at Century Aluminum Company's Hawesville plant in Hawesville, Ky. on Wednesday, May 10, 2017. (Photo by Luke Sharrett /For The Washington Post via Getty Images) Aluminum The Washington Post | The Washington Post | Getty Images Sweeping tariffs imposed by U.S. President Donald Trump on imported aluminum are reshaping global trade flows and inflating costs for American consumers. But they are falling short of their primary goal: to revive domestic aluminum production. Instead, rising costs, particularly skyrocketing electricity prices in the U.S. relative to global competitors, are leading to smelter closures rather than restarts. The impact of aluminum tariffs at 25% is starkly visible in the physical aluminum market. While benchmark aluminum prices on the London Metal Exchange provide a global reference, the actual cost of acquiring the metal involves regional delivery premiums. This premium now largely reflects the tariff cost itself. In stark contrast, European premiums were noted by JPMorgan analysts as being over 30% lower year-to-date, creating a significant divergence driven directly by U.S. trade policy. This cost will ultimately be borne by downstream users, according to Trond Olaf Christophersen, the chief financial officer of Norway-based Hydro , one of the world's largest aluminum producers. The company was formerly known as Norsk Hydro . 'It's very likely that this will end up as higher prices for U.S. consumers,' Christophersen told CNBC, noting the tariff cost is a 'pass-through.' Shares of Hydro have collapsed by around 17% since tariffs were imposed. Stock chart icon The downstream impact of the tariffs is already being felt by Thule Group , a Hydro customer that makes cargo boxes fitted atop cars. The company said it'll raise prices by about 10% even though it manufactures the majority of the goods sold in the U.S locally, as prices of raw materials, such as steel and aluminum, have shot up. But while tariffs are effectively leading to prices rise in the U.S., they haven't spurred a revival in domestic smelting, the energy-intensive process of producing primary aluminum. What will it take to revive smelters in the U.S.? The primary barrier remains the lack of access to competitively priced, long-term power, according to the industry. 'Energy costs are a significant factor in the overall production cost of a smelter,' said Ami Shivkar, principal analyst of aluminum markets at analytics firm Wood Mackenzie. 'High energy costs plague the US aluminium industry, forcing cutbacks and closures.' 'Canadian, Norwegian, and Middle Eastern aluminium smelters typically secure long-term energy contracts or operate captive power generation facilities. US smelter capacity, however, largely relies on short-term power contracts, placing it at a disadvantage,' Shivkar added, noting that energy costs for U.S. aluminum smelters were about $550 per tonne compared to $290 per tonne for Canadian smelters. Recent events involving major U.S. producers underscore this power vulnerability. In March 2023, Alcoa Corp announced the permanent closure of its 279,000 metric ton Intalco smelter, which had been idle since 2020. Alcoa said that the facility 'cannot be competitive for the long-term,' partly because it 'lacks access to competitively priced power.' Similarly, in June 2022, Century Aluminum , the largest U.S. primary aluminum producer, was forced to temporarily idle its massive Hawesville, Kentucky smelter – North America's largest producer of military-grade aluminum – citing a 'direct result of skyrocketing energy costs.' Century stated the power cost required to run the facility had 'more than tripled the historical average in a very short period,' necessitating a curtailment expected to last nine to twelve months until prices normalized. Competition with the tech sector The industry has also not had a respite as demand for electricity from non-industrial sources has risen in recent years. Hydro's Christophersen pointed to the artificial intelligence boom and the proliferation of data centers as new competitors for power. He suggested that new energy production capacity in the U.S., from nuclear, wind or solar, is being rapidly consumed by the tech sector. 'The tech sector, they have a much higher ability to pay than the aluminium industry,' he said, noting the high double-digit margins of the tech sector compared to the often low single-digit margins at aluminum producers. Hydro reported an 8.3% profit margin in the first quarter of 2025, an increase from the 3.5% it reported for the previous quarter, according to Factset data. 'Our view, and for us to build a smelter [in the U.S.], we would need cheap power. We don't see the possibility in the current market to get that,' the CFO added. 'The lack of competitive power is the reason why we don't think that would be interesting for us.' While failing to ignite domestic primary production, the tariffs are undeniably causing what Christophersen termed a 'reshuffling of trade flows.' When U.S. market access becomes more costly or restricted, metal flows to other destinations. Christophersen described a brief period when exceptionally high U.S. tariffs on Canadian aluminum — 25% additional tariffs on top of the aluminum-specific tariffs — made exporting to Europe temporarily more attractive for Canadian producers. Consequently, more European metals would have made their way into the U.S. market to make up for the demand gap vacated by Canadian aluminum. Read More Ørsted tapos Errboe as deputy CEO, chief commercial officer Scrap metal 'indirectly' hit by tariffs The price impact has even extended to domestic scrap metal prices, which have adjusted upwards in line with the tariff-inflated Midwest premium. Hydro, also the world's largest aluminum extruder, utilizes both domestic scrap and imported Canadian primary metal in its U.S. operations. The company makes products such as window frames and facades in the country through extrusion, which is the process of pushing aluminum through a die to create a specific shape. 'We are buying U.S. scrap [aluminium]. A local raw material. But still, the scrap prices now include, indirectly, the tariff cost,' Christophersen explained. 'We pay the tariff cost in reality, because the scrap price adjusts to the Midwest premium.' 'We are paying the tariff cost, but we quickly pass it on, so it's exactly the same [for us],' he added. RBC Capital Markets analysts confirmed this pass-through mechanism for Hydro's extrusions business, saying 'typically higher LME prices and premiums will be passed onto the customer.' This pass-through has occurred amid broader market headwinds, particularly downstream among Hydro's customers. RBC highlighted the 'weak spot remains the extrusion divisions' in Hydro's recent results and noted a guidance downgrade, reflecting sluggish demand in sectors like building and construction. — CNBC's Greg Kennedy and Silvia Amaro contributed reporting.
Yahoo
08-05-2025
- Yahoo
Arlington PD first in state with expanded drone program
Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience. Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience. Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience. Generate Key Takeaways The Brief Arlington PD has received a waiver to fly drones outside an officer's "line-of-sight." The department says they are the first in Texas to be granted the waiver by the FAA. They hope the expanded drone program will decrease response times and protect officers. (Luke Sharrett/Bloomberg via Getty Images) ARLINGTON, Texas - The Arlington Police Department is elevating its use of drone technology. According to Chief Al Jones, the department is the first in the state to obtain a "line-of-sight" waiver from the Federal Aviation Administration. Jones says this expanded permit allows them to operate drones without a visual observer. The chief says the program will help police perform their job safely. 'Drones as a First Responder' program The new operation is called the "Drone as a First Responder" program, or DFR. The department has been designing, tweaking and trying out its use to enhance the response to calls. They say the program will never replace officers' response. The DFR program began two months ago, though drones have been in use by the department for years. The drones are launched from two docks in separate locations. What they're saying Jones tells us the program may be able to reduce response times drastically. "We have about an eight-minute response, but with our drones within our radius, we could do it within a minute or two," the chief said. "This program is really going to ramp up how we are using drones and take us to the next level." According to Jones, their ability to fly the drones at long range from their officers will help to keep law enforcement out of harm's way. "Our officers respond, not knowing whether a person has a gun or not, but our drones can fly to that location, get real-time intelligence, being able to identify whether the person has a gun or not, and provide that intelligence to our officers," said Jones. "Our job is to deliver to those officers the best information that we can as quickly as we can so they can do their job better and safer," said Sgt. Eric Borton. "This role becomes even more complicated when those officers respond to more serious calls such as burglaries or assaults in progress." The plan going forward What's next As the program progresses, the department says their goal is to add more drones to their force. The Source Information in this article was given by the Arlington Police Department.
Wall Street Journal
07-05-2025
- Business
- Wall Street Journal
Cleveland-Cliffs to Pause Operations at Several Plants After Wider Loss, Lower Revenue
Cleveland-Cliffs posted a loss of $495 million, compared with a loss of $67 million a year earlier. Photo: Luke Sharrett/Bloomberg News Cleveland-Cliffs CLF -1.39%decrease; red down pointing triangle will pause or slow operations at plants after logging a wider loss and lower revenue in the first quarter. The steelmaker on Wednesday said it is fully or partially idling six facilities between March and May, and cited the need to optimize its footprint and shift away from loss-making operations.
Yahoo
07-05-2025
- Politics
- Yahoo
Lawmakers, faith leaders stress gun safety as permitless concealed carry bills advance
Getty Images/Luke Sharrett Gun control advocates and faith leaders held a press conference at the state Legislative Building Wednesday urging lawmakers to oppose bills that would allow carrying concealed firearms without a permit. It's one of the biggest issues this session. Legislators are considering bills that would allow 'constitutional carry,' or the idea that individuals should be able to carry concealed weapons without restrictions based on the Second Amendment. Senate Bill 50, 'Freedom to Carry NC,' allows North Carolinians who are U.S. citizens, at least 18 years of age, and not otherwise prohibited by law, to carry concealed weapons without applying for a permit. It's backed by Republican leadership and would make North Carolina the 30th state to enshrine such a policy in state law. The bill has passed the Senate and is awaiting action in the House. Its counterpart in the lower chamber, House Bill 5 or 'NC Constitutional Carry Act,' has the same idea. This measure still needs approval from the House Rules Committee. Rep. Phillip Rubin, a Democrat from Wake County, said the fact that either bill is even under consideration is a reflection of the troubled state of democracy in North Carolina. North Carolina is one of the 'most intensely' gerrymandered states in the country, he said, with Republicans earning less than 48% of the vote statewide but holding 59% of the seats in the legislature. At the congressional level, the North Carolina delegation went from an even 7-7 split to a 10-4 Republican majority following GOP-crafted redistricting. 'In a functioning democracy where elected representatives feel accountable to the people they represent, a bill this unpopular and this dangerous would never pass. It would never even come to a vote,' he said. 'That is why I'm so sad to see common sense gun regulation measures that can't get a vote, and dangerous measures like permitless concealed carry that repeatedly can.' Polls released recently by Everytown for Gun Safety and Elon University found the bulk of North Carolina voters against loosening gun regulations. Rev. Jennifer Copeland is the executive director of the North Carolina Council of Churches, which represents 19 denominations. She said owning or carrying a gun doesn't make people safe. 'All of us are less safe when everyone around us has a gun tucked into their waistband or carries it around in their purse,' she said.
Yahoo
29-04-2025
- Politics
- Yahoo
A simple step to prevent gun violence that all sides should be able to support
Getty Images/Luke Sharrett North Carolinians are generally of two very different minds on the gun violence that plagues our society. While polls consistently show that most favor stronger laws to regulate firearms, a loud and determined minority opposes virtually any regulation. Here, however, is at least one simple prevention step that all sides should be able to endorse: installing inside locks on the doors to college classrooms. As NC State professor Walter Robinson explained in a recent NC Newsline op-ed, he and his faculty colleagues have repeatedly asked school leaders to install locks in all classrooms and lecture halls so that instructors and students can shelter in place in the event of a campus shooting. Unfortunately, and amazingly, however, the requests have been rejected. The reason: cost. And it's hard to overstate just how absurd this is. The bottom line: In a multi-billion dollar system, it's ridiculous that university leaders didn't long ago invest in such a simple and basic safety precaution. Further delay is inexcusable. For NC Newsline, I'm Rob Schofield.
