Aluminum Corp of China (Chinalco) will close its biggest smelter, which accounts for about an eighth of its total capacity, according to Reuters. The Liancheng smelter has an annual capacity of about 550,000 metric tons (mt), compared with Chinalco’s total capacity of more than 4 million mt.

Liancheng was Chinalco’s worst performing smelter, according to a China Nonferrous Metals Industry Association, and the company had been unable to turn it around. Production costs at Liancheng averaged $2,180/mt for the first eight months of this year. This compared to an average in China of about $2,075/mt. Aluminum is currently selling for $1,491/mt on the LME.

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