Network Metals LLC

Interesting and very telling news from Alcoa (NYSE:AA). The company has decided to “temporarily” shut down its Texarkana, TX aluminum rolling mill and transfer the work to its Lancaster, PA facility; it will lay off 250 workers. The word on the street is that this move will be for longer than 3-6 months, and that Alcoa is not expecting an improvement in the business climate any time soon.

The Texarkana plant produces aluminum sheet of various alloys that are related mostly to building and construction - these are higher end aluminum sheet products, but not as high quality as the aluminum sheet used for packaging. The alloy 5052 is used for highway signs and the alloy 3003 is used for tread plate or diamond plate often seen in building stairwells and entrances. The Lancaster plant makes mostly 3105 alloy which is a lower end sheet product and requires much less value added (increased profit!) for Alcoa.