SOUTH32: Mozal Aluminium production increases by 30%
Worsley Alumina saleable production decreased by 5% (or 134kt) to 2,827kt in the nine months ended March 2023 with planned calciner maintenance in the September 2022 and March 2023 quarters. FY23 production guidance remains unchanged at 4,000kt, with the refinery expected to achieve nameplate production rates in the June 2023 quarter.
Brazil Alumina saleable production increased by 6% (or 59kt) to 1,025kt in the nine months ended March 2023, following the bauxite ship unloader outage in the prior period.
In late March 2023, the belt system that conveys raw materials from the port failed and the refinery reduced production to manage bauxite inventories. The belt system was repaired in April 2023 and the refinery has since returned to normal production levels. Due to this temporary outage, FY23 production guidance has been reduced by 4% to 1,340kt.
Notwithstanding lower planned volumes, FY23 Operating unit costs are expected to be approximately 5% below H1 FY23 (US$364/t) as raw material and energy prices continue to moderate.
Brazil Aluminium saleable production was 45.3kt in the nine months ended March 2023, following the successful restart of the smelter in the June 2022 quarter. Production improved by 40% (or 6.2kt) in the March 2023 quarter as all three potlines ramped-up toward nameplate capacity as planned. FY23 and FY24 production guidance remains unchanged at 75kt and 148kt respectively.
Hillside Aluminium saleable production increased by 1% (or 4kt) to 539kt in the nine months ended March 2023 as the smelter continued to test its maximum technical capacity despite the impact of elevated load-shedding. FY23 production guidance remains unchanged at 720kt.
Sales increased by 13% in the March 2023 quarter with two carry-over shipments from the prior quarter supporting a drawdown in inventory.
While the cost profile of Hillside Aluminium will continue to be heavily influenced by the South African rand and the price of raw materials, the company expects FY23 Operating unit costs to be largely in-line with H1 FY23 (US$2,276/t).
Mozal Aluminium saleable production increased by 30% (or 61kt) to 263kt in the nine months ended March 2023, reflecting our increased ownership of the smelter [11]. During the March 2023 quarter, we made the decision to temporarily reduce amperage at the smelter to support the safe recovery of operations following the fatal incident in November 2022. The recovery plan was impacted by resourcing constraints during the quarter as significant floods restricted the movement of people and equipment to the smelter. FY23 production guidance has been reduced by 8% to 340kt [10], with the smelter expected to return to nameplate capacity during the September 2023 quarter.
FY24 production guidance is unchanged at 370kt.
The execution of the recovery plan also resulted in a temporary reduction in metal quality. During the quarter, approximately 35% of production was below specification and sales volumes decreased by 52% (or 47kt) as we assessed commercial alternatives for this material.
We have now commenced shipments of this material, achieving realised prices that reflect a modest discount to our other LME-linked aluminium sales. Sales volumes are expected to increase to approximately 100kt in the June 2023 quarter as inventory is drawn down and product quality improves in-line with the recovery plan.
The temporary reduction in sales volumes is expected to have a modest impact on FY23 Operating unit costs, with FY23 Operating unit costs expected to be approximately 5% above H1 FY23 (US$2,237/t) subject to the price of raw materials.
