Russian metal giant “freezes” drives, and thousands of people are losing their jobs

World biggest aluminum company Rusal maybe shuts down its non profitable aluminum foundry and 7560 workers will stay without jobs.This will in total change the way small town look where industry is safety.

Russian tycoon and first man of Rusal Oleg Deripaska said the production could be temporarily closed in five branches of company in Russia till the end of year. Rusal employees around 72000 people, and it works in 19 countries. By “freezing” of production, thousand of people could stay without jobs. It is talked about closing Rusal’s parts in Ural, Karelij region, as well as Volgograd and Leningrad’s region.

Falling down of aluminum price is one of the main reasons for making this decision, and Deripaska pointed out that it will not be new starting of production till the prices don’t go back to 2400 dollars per ton, and it fell to 1,755 dollars per ton. Among other reasons there are Rusal’s bad financial results in last few months, as well as increase in expenses of electricity and transport. Aluminum giant has finished year 2012 with the loss of 55 million American dollars.

Leading Russian aluminum company is faced with difficult position on metal market which resulted in fall of company value in first half of 2013 of 54,3 %. For recovery is needed to cut down on production for 8,4 %, and temporarily to close production plants, but with the protection of plants in Siberia.

Many Russian metal and mining companies are dropped out from elite group of 27 companies with the most valuable stocks on Moscow stock market. Metal companies, hard struck by price fall, can not have good position on market any more. Other Russian metal companies are faced with similar losses. Severstal lost 33,6 % of its capitalization, Norilsk Nickel lost 34,6 %, and Evraz fell 61% during the fall of metal price.

China, as main metal consumer, cut down on demands along with cut down of production sector during recession.

Three Rusal’s problematic plants are so called monocities, which means that they are used to create and insure working places for majority of these areas. The company is now negotiating with regional and federal authorities about future of those who will be left without job, it is said in Rusal. One of the options is to employ the staff in other Rusal’s companies. It is not the first time that Russian

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