PNP tells Comrades to expect closure of Alpart

PNP tells Comrades to expect closure of Alpart

South/Central Bureau

Monday, August 26, 2019

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MAGGOTTY, St Elizabeth — The leadership of the People's National Party's (PNP) Region Five told Comrades at a Regional Executive Council (REC) meeting here yesterday that they should expect the bauxite/alumina JISCO Alpart plant in Nain to close soon.

Hopeton McCatty, who was returned unopposed as the PNP's Region Five chairman, confirmed to the Jamaica Observer after the meeting that a report to that effect had been made to REC members.

Mikael Phillips, Member of Parliament for Manchester North Western, told the Observer that the available evidence suggested JISCO Alpart's temporary closure was unavoidable.

This, against the background of losses caused by falling alumina prices and the urgent need to modernise the more than 50-year-old Alpart plant, which is said to be among the world's most inefficient.

Phillips said that while “we haven't heard anything definitive from the Government or from JISCO themselves” a recent meeting between the PNP leadership and JISCO Alpart appeared to indicate a halt on alumina production would come soon.

Word from employees at the plant had led to the same conclusion, said Phillips.

“Up to today, persons who are employed there have been telling me that by the end of the month they expect production to halt,” said Phillips, who is a former Region Five chairman and son of PNP President Dr Peter Phillips.

A source, who declined to be named, said materials needed for the alumina refining process were running low and no new orders had been made by the plant's management. Caustic soda, which is central to alumina refining, was down to 35 per cent, the source said. However, there had been no fresh orders for caustic soda.

“Materials necessary to keep the plant going have not been ordered. Caustic soda is at 35 per cent and they haven't ordered any more...” the source said. Efforts to get a comment from JISCO Alpart failed yesterday. The company's communications manager Julian Keane could not be reached for comment.

However, when the Observer contacted Mining Minister Robert Montague, he said the Government, which met with JISCO officials up to last Thursday, was still awaiting word from the company.

JISCO Alpart recently confirmed it had laid off 250 casual workers as part of a cost-cutting exercise. But the company subsequently said it had rehired 50.

Currently the plant employs 1,000 permanent staff and any closure would have an impact on the economy.

There has been considerable speculation in recent weeks that JISCO Alpart will have to shut down its operations because of heavy losses and the need to retool.

When Alpart reopened refining operations in 2017 following its acquisition by the Chinese metals giant, JISCO, from Russian company UC Rusal in 2016, it was recognised that the plant, which had been mothballed since 2009, was in urgent need for retooling.

One JISCO executive reportedly joked in 2016 as negotiations took place with UC Rusal that the plant resembled a 90-year-old woman trying to “climb Mount Everest”.

JISCO is said to have gone ahead with reopening of the plant in 2017 because of the relatively high price of alumina on the global market at the time — then in excess of US$500 per tonne.

But the price has since fallen to below US$300. In the last year alone, the price has dropped from US$450 per tonne to less than US$300, industry sources say.

Reports say machinery at the ageing plant is so inefficient that waste from the refining of alumina from bauxite ore is in the region of 30 per cent.

Alumina is the base material for the highly utilitarian light metal aluminium, which is used in the production of a range of products from food wrapping to cars and aeroplanes.

Just as the price of alumina has fallen, so has aluminium, industry sources say.

Uncertainty in the global marketplace and depressed prices are said to have flowed from a confluence of circumstances including a so-called trade war between the United States and China, uncertainty over Britain's exit from the European Union, and an uptick in alumina production in Brazil.

Yesterday, both Phillips and McCatty urged action from the Government and JISCO to tell the country the true state of affairs and to do whatever is necessary to protect workers.

Dr Dwaine Spencer, who is the PNP's aspirant for the St Elizabeth South Eastern seat currently held by the ruling Jamaica Labour Party's Frank Witter, said he was “hoping and praying” that the Government and JISCO will find a way to keep the plant open.

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