Inalum cuts production target by 10%

Inalum cuts production target by 10%

Dow Jones, Singapore

PT Indonesia Asahan Aluminum (Inalum) has lowered its primary aluminum output target 10 percent to 200,000 metric tons this fiscal year, a company executive told Dow Jones Newswires Wednesday.

The cut is due to inadequate power supply caused by low water levels in Lake Toba which company uses for its hydroelectric power plant, the executive said.

The company previously forecast this fiscal year's output at 222,827 tons. The company's fiscal year started in April.

PT Indonesia Asahan Aluminum has an annual capacity of 225,000 tons and is the sole aluminum producer in Southeast Asian.

The company has run its 600-megawatt power plant at 420 MW since last year due to low water levels. The previous fiscal year's output stood at 205,002 tons.

"We can't afford to build a new power plant, and don't...plan to," the executive said.

The company exports about 60 percent of its production to Japan. Nippon Asahan Co., a consortium of Japanese companies and banks, holds a 60 percent stake in the Indonesian company.