Dunkirk aluminium smelter to trim production by 15% in total due to towering energy rates

In reaction to rising power rates, a large aluminium smelter in northern France will cut production by 15%, according to a representative for the plant.

According to a spokesperson,  Dunkirk aluminium smelter, which has an annual capacity of roughly 285,000 tonnes, has already reduced output by 10% and will reduce it by 5% again in the upcoming week, according to a spokesperson.

Dunkirk is one of several European aluminium facilities that have reduced output since last month as a result of high power costs that have harmed the energy-intensive industry's profitability.

A spokesperson for the company declined to comment on the possibility of further production reduction. If power rates do not fall, a CGT union leader at the plant, Laurent Geeraert, warned local radio station Delta FM that cutbacks will be increased to about 25% of capacity.

The Dunkirk smelter is one of the big energy consumers in talks with the French government and state-owned EDF (EDF.PA), which controls the country's nuclear power network, about relief measures.

Dunkirk receives roughly 60% of its power under a special rate plan, but the other 40% is subject to market rates.

On Friday, France's finance minister said he was working on new measures to curb the rise in power rates, with the government concerned about the impact on consumers ahead of the presidential election in April.

Following a debt default by a portion of former owner GFG Alliance, private equity company American Industrial Partners (AIP) purchased the Dunkirk smelter last year. GFG, which is controlled by commodities tycoon Sanjeev Gupta, is challenging the takeover.