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Egypt: Falling profit of aluminum plant threatens future of thousands of workers

2019-11-09

Trade union sources at the aluminum plant in Egypt said the company had significant losses in the current financial year due to rising electricity prices last June. The same sources explained that an increase of one penny leads to an increase in the cost of production of about 50 million pounds a year. The company's financial indices, which employ more than 10,000 workers, revealed that the company's profits declined by about 78% in 2018-19.

According to experts, this drop is mainly caused by the rise in electricity prices for factories, which represent about 40% of the cost of production, and other imported materials, not to mention the fall in world metal prices and the competition from imported products. The other causes of this decline also come down to the drop in world metal prices to about $ 80 per ton with a current average of $ 1,700 which has led the company to lower prices for about 3,000 pounds per ton while cylinder prices reached 37,500 pounds, yarns to 35,000 pounds and sectors to 47,000 pounds.

In this context, experts in aluminum manufacturing explained that among the possible solutions for the end of the crisis, there is the option of reducing the cost of production via a price fixing of electricity imported by the government according to world metal prices, especially since the Arab metal-producing countries, and therefore competitors of the Egyptian product, subsidize the energy intended for the factories.

The Egyptian Aluminum Company has a monopoly on the production, manufacture and export of aluminum in Egypt for more than 43 years.