U.S. Metals & Minerals Industry Plant Closures on the Rise in 2009

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Researched by Industrial Info Resources (Sugar Land, Texas)--For the Metals & Minerals Industry, 2009 is shaping up to be a record year for plant and mine closures in the U.S. Just one month into the year, 45 major Metals & Minerals Industry plants and mines with 8,600 employees have already closed or have announced plans to close in 2009. One of the casualties is Century Aluminum Company (Monterey, California), which recently announced it would completely shut down an aluminum smelter in Ravenswood, West Virginia, affecting 651 employees. Century Aluminum had already shut down one potline at the end of last year and is now in the process of shutting down the remaining three potlines. The price of aluminum has decreased 50% since mid-2008, impacting aluminum producers' profitability.

Click on the image at right to view a chart showing the breakdown of Metals & Minerals Industry plant closures by year for the last decade.

The main reasons for the plant closures are non-profitability or lack of business brought about by poor market conditions. The sectors being affected most are the foundry sector and the building-products sectors. Foundries, many of which cast metal automotive parts, have been severely impacted by declining auto sales, while the manufacturers of building products such as gypsum wallboard and cement board have been impacted by declines in new home construction.

This news comes on the heels of 2008, which saw 73 plants close with more than 10,000 employees and marked the highest plant closure rate for the industry since 2004. If the current pace continues, plant closures for the Metals & Minerals Industry in 2009 could easily exceed 150 closures, making this the worst year for plant closures in the past decade.

Industrial Info Resources (IIR) is a marketing information service specializing in industrial process, energy and financial related markets with products and services ranging from industry news, analytics, forecasting, plant and project databases, as well as multimedia services.