Eurometaux, which represents producers such as Glencore, Rio Tinto and Norsk Hydro, has sent the European Commission a letter about this. In it, they warn that more and more producers could be forced to reduce their production or even close factories completely if additional support is not forthcoming.
Aluminum and zinc producers are particularly hard hit by rapidly rising gas and electricity prices. In recent months, several smelters have been forced to stop production, causing regional shortages. This also resulted in a sharp rise in product prices. About a third of the aluminum capacity is limited by the crisis, according to the letter writers.
While power prices have fallen from last month’s peaks, smelters are still suffering heavy losses in countries such as France. Furthermore, gas supplies in Europe are well below the level that is usual for this time of year. Due to the lack of gas supplies from Russia, new price peaks are looming this winter.
In the letter, Eurometaux proposes to use the national gas reserves to stabilize the market. The steel companies are also thinking of lower prices for CO2 emissions to reduce costs. Consideration should also be given to a support package similar to temporary measures taken to steer the economy through the corona crisis.
Also look at: Can the government do something about the high energy prices?