Network Metals LLC

News out of Russia and some Middle Eastern countries today regarding aluminum smelters and falling costs is not necessarily good news - it’s basically a game of chicken between Western and Third World producers. Russian and Third World aluminum producers are lowering production costs while Western smelters (Alcoa (NYSE:AA), Century Aluminum (NASDAQ:CENX), Noranda) are suffering. As soon as most of these forward sales and forward hedges, booked last year, wind down, Western producers may be forced to cut production, leaving the eventual turnaround in aluminum pricing solely to the Third World smelters.