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FerroAtlantica cites market in cancelling $382M Quebec project

DCN News Service
FerroAtlantica cites market in cancelling $382M Quebec project

PORT-CARTIER, QUE.—Plans for a $382-million investment to build a new silicon metal plant in Port-Cartier, Que. have been abandoned, it was announced Dec. 16.

Spanish-owned Grupo FerroAtlantica had unveiled plans to build its first North American silicon metal plant at a media conference held in June 2014. Quebec Premier Philippe Couillard was on hand to announce loan guarantees. The factory was set to produce 100,000 tonnes annually of silicon metal, which is used in aluminum alloys. Silicon metal is also used in construction of solar panels.

The recent news that FerroAtlantica was scrapping its plans came with an explanation in a media release that the firm was acting "in light of recent market developments" and that FerroAtlantica was "facing the prospect of optimizing the production capacity of its existing operations."

Recent developments in China’s silicon industry have led FerroAtlantica to review its growth strategy, the company’s statement said.

"The current and announced growth of China’s production capacities are such that they will significantly tilt the market balance over the long term. This new factor compels FerroAtlantica to seek new development opportunities to complement its growth strategy through the optimization of its existing infrastructures, particularly in Europe. The Group will therefore favour expanding its activities from its home ports over investing in new facilities."

FerroAtlantica said, "This decision was not motivated by any local issues. Unfortunately, for FerroAtlantica, no new project can take precedence over consolidating our own facilities."

The decision was made "with a heavy heart."

The firm made the gesture of announcing that it will participate financially in a structuring initiative for the development of Port-Cartier’s port infrastructures, and that it is also considering the possibility of sharing the results of studies conducted over the past months with its former Quebec partners.

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