Make Reviving Ormet a Priority
A few dozen workers left at the Ormet Corp. aluminum plant at Hannibal have been told they may lose their jobs this summer. If so, they will follow about 1,000 co-workers already laid off from the idled facility.
Hope lingers that the company can find a buyer willing to resume production at the plant – but faith rests on the slender thread someone can find a way to make the plant profitable.
Plummeting aluminum prices and failure to gain a break on electricity bills prompted Ormet management to close the plant several months ago. Only 42 workers, mostly guards and maintenance personnel, remain on the job. By July 31, they may be sent home.
Ormet is involved in bankruptcy proceedings. Some equipment and raw materials already have been sold to pay the plant’s bills.
But there have been reports a potential buyer is considering purchase of the plant. It is not known whether the person or company is interested in resuming aluminum production or demolishing the facility to make a profit from salvage sales.
Two factors – again, the price of aluminum and the cost of electricity – are critical to a decision on that.
Aluminum prices continue to decline. The trend is at a three-year low of about $1,728 per metric ton. That compares to $2,587 just three years ago.
At some point, aluminum prices will have to bottom out and begin rising again. Whether that point is near will be an important consideration for a potential buyer.
Electric bills are another story. Ormet was unable to negotiate a favorable contract with American Electric Power. The Public Utilities Commission of Ohio refused to order AEP to sell to Ormet at the price company officials said they needed to stay in business.
But a new owner could be a different story. Officials at the PUCO might be able to work out an acceptable arrangement in such a situation.
Most former Ormet employees live in Wetzel and Monroe counties, which have the highest unemployment rates in their states. Clearly, reviving Ormet would be important to the region’s economy. For that reason, Ohio officials – at the PUCO and other agencies – should make it a priority to do what they can to make the plant attractive to a buyer willing to give aluminum production a go.