“It is now important to continuously improve productivity to keep costs of production as low as possible for combatting COVID19 impact” - Antti Koulumies, Vice President, Aluminium Business Line, Outotec

Outotec provides industry benchmark technologies and life-cycle services for their customers in metals and mining, industrial water treatment, alternative energy, and chemical sector. Here, we have with us the company’s aluminium business Vice President Antti Koulumies to share how Outotec is coping up the COVID19 pandemic. Mr Koulumies says ensuring the wellbeing of the employees and stakeholders and innovating and improving operations to serve customers better are their key strategies now to sustain the business.

Here is an excerpt from the brief interview:

AlCircle: What are your initial thoughts about the impact of Covid-19 on the global aluminium value chain? 

Antti Koulumies: From what we’ve seen, only one aluminium smelter and one alumina refinery have curtailed production during the pandemic. Even China’s production was quite stable during Q1. However, the disruptions in industries such as automotive and aerospace have had a very drastic and direct impact on the global aluminium consumption, and as aluminium production is typically quite costly to stop, we’ve seen build-up in inventories globally. This, in turn, has reflected in lower prices and lower demand for value-added products, resulting in many aluminium producers suffering. I believe these impacts will be largely temporary, however, as demonstrated by what’s happening in post-lockdown China where industrial activity is quickly picking up. Further, if governments continue to invest in infrastructure projects to resuscitate their economies, this can also be good for aluminium, for example, further subsidies for e-mobility could be a good candidate for infrastructure improvement, and these typically consume quite a bit of aluminium.

AlCircle: How much has this pandemic impacted your business?

Antti Koulumies: Our priority is to ensure the health and safety of our employees and key stakeholders while continuing the operations of our customers. We obviously can’t visit sites like normally we would, but we have found innovative ways to provide, for example, technical support remotely. Meanwhile, our project and spare part deliveries are continuing as normal, and we have also picked up some nice orders during the first quarter despite the situation. For example, we published in late February that we received a contract of supplying calciners to Nalco’s refinery expansion.

For us, it’s very important to keep in touch with our customers and I’m really pleased with the strength of our customer relationships, which I know will carry through this crisis. One customer even sent me some PPE just as a personal gesture, which I was very touched by!

AlCircle: What’s your current assessment of the Covid-19 impact on the European aluminium industry?

Antti Koulumies: I think the European aluminium industry is in the same boat as its global competitors. It is now important to continuously improve productivity to keep costs of production as low as possible. There are obviously some higher-cost smelters in this region, but it will be interesting to see how the ones that focus on higher value-added products will weather this storm.

AlCircle: Have you developed/implemented any mitigation plans and strategies to minimize the effect of COVID-19 on your plant operation?

Antti Koulumies: We don’t have a lot of own manufacturing so, our main focus has been to work with suppliers to minimize disruptions, and so far we have succeeded quite well as we have long standing and trusting relationships with our key suppliers. On the other hand, we also had to start working remotely like most other office workers, which, after a few initial days, started performing better than we even expected. People seem to be quite efficient, as they save a lot of time from commutes.

AlCircle: Is COVID19 making you reconsider your expansion or investment plans in the years ahead?

Antti Koulumies: I believe we’re quite well positioned at the moment to weather this storm. Our efforts in developing our digital product are offering continuous and remote support, while at the same time, we’re quite fortunate to have a bit of workload on our hands, which will carry us a long way. We’re also paying attention to how we can become even more responsive in our services such as technical field service and spare parts delivery so that we can support our customers the best we can.

AlCircle: How COVID-19 changes the outlook for 2020 for the global aluminium industry?

Antti Koulumies: Despite the immediate term hiccup, which we don’t know how long it’ll take, I think the macro picture is still quite similar. The world will still be looking for solutions to tackle climate change and air pollution, and here I believe, aluminium is more part of the solution than the problem. Aluminium has a strong future and there will be investment in this field also in the years to come, once we consume the inventories that are now building up. At the same time, producers will also have to consider further measures to clean up their environmental footprints.

AlCircle: How do you plan to continue offering sustainable services post this pandemic?

Antti Koulumies: I believe that our team spirit is strong, and we have a strong desire to serve our customers. We’re continuously trying to innovate, especially in the field of digital, and I believe a large focus in the carbon area, for example, the rod shop, will be around further automation to get people out of hazardous working areas.

AlCircle: Any suggestions you would like to offer to your business associates and customers to combat the present crisis.

Antti Koulumies: Let’s remember that this crisis will end someday, and then we’ll be measured on the one hand by how well we took care of our employees during this crisis and how we managed to innovate and improve operations during the pandemic.

source https://alcircle.com/interview/detail/54684/it-is-now-important-to-continuously-improve-productivity-to-keep-costs-of-production-as-low-as-possible-for-combatting-covid19-impact-antti-koulumies