Speira Germany said on September 7 it would cut aluminum production at its Rheinwerk plant by 50 percent from October due to high electricity prices.

European smelters are estimated to have cut 800,000 to 900,000 tonnes/year of aluminium output since energy prices began to rise last year. A further 750,000 tonnes of production could be cut in the coming winter, which would mean a bigger gap in European aluminium supply and higher prices.

The aluminum smelting industry is an energy-intensive industry. Electricity prices in Europe have risen further after Russia cut gas supplies to Europe, meaning many smelters are operating at higher costs than market prices.

Speira said on Wednesday it would reduce primary aluminium production to 70,000 tonnes a year in the future as rising energy prices in Germany make it facing challenges similar to those of many other European aluminium smelters.

Energy prices have reached very high levels over the past few months and are not expected to drop anytime soon.

Speira production cuts will begin in early October and are expected to be completed in November.

The company said it had no plans to impose layoffs and would replace cut production with external metal supplies.

Eurometaux, the European metals industry association, estimates that Chinese aluminium production is 2.8 times more carbon intensive than European aluminium. Eurometaux estimates that substitution of imported aluminium in Europe has added 6-12 million tonnes of carbon dioxide this year.