Alcoa (ASX:AAI) shares fell past 8% in recent Thursday trade after the company's CFO warned that its alumina unit will be "underwater" due to losses caused by energy disruptions and the blockage of the Strait of Hormuz.
Speaking during a presentation at the Wells Fargo Industrials & Materials Conference, Alcoa CFO Molly Beerman said the alumina business "is very pressured right now" and will be unprofitable in the current quarter as a result of elevated production costs, Bloomberg reported.
Alcoa's alumina refineries usually ship the material to aluminum smelters in the Persian Gulf, where refineries consume large volumes of fuel and electricity.
Beerman said the company now anticipates a further $15 million of fuel costs at its São Luís refinery in Brazil, and also faces about $30 million of higher production costs at a refinery in Western Australia, according to the report.
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