Dubai Aluminium Company Limited (Dubal), which has the largest modern smelter with a captive power station, said it was ‘business as usual’ at the company with no cuts planned in production or manning levels.

Dubal continues to operate at full production capacity, said Abdulla J M Kalban Dubal president and CEO, while delivering the welcome address at the 14th World Aluminium Conference, co-hosted by Commodity Research Unit (CRU) and Dubal at the Grand Hyatt Dubai.

He pointed out that Dubal’s stance was bold, given the drastic cuts in production capacity among the world’s major aluminium producers since the onset of the current economic downturn.

"It is nevertheless a stance based on sound business sense," Kalban explained.

“Although Dubal during the first quarter of this year experienced a 30 per cent decline in orders from our established global customer base, many of whom are engaged in the automotive and building industries that were hardest hit by the recession, we maintained our sale volumes on par with the prior year,” he added.

“We have achieved this by establishing new markets for our metal, and changing our product mix to meet the needs of customers. This has resulted in our full production capacity being required to fulfil the orders – a scenario that will continue for the foreseeable future,” he added.

Kalban said that Dubal’s status as one of the world’s environmentally-cleanest and lowest production cost smelters is not only a major competitive advantage in these difficult times, but an attribute that is being safeguarded through continual efforts to reduce Dubal's cost of production in every area of the business.

“I believe we should continue to produce at full capacity to ensure that the smelters that have to shut down are the less-efficient energy users, usually with lower environmental standards,” he said.

“It is for this reason that I also support the new smelters being developed or planned for the region,” he stated.

In particular, Dubal remains interested in the lucrative business proposition inherent in the green-field smelter developments planned in Saudi Arabia.

“Dubal and Mubadala have signed a MoU with Sagia and Emaar the Economic City regarding the possible development of a primary aluminium smelter at the proposed King Abdulla Economic City,” Kalban confirmed.

“The project is currently still on the table: pre-feasibility and potential downstream industry studies have been completed, but the exact dates for the the project to progress to the next stage have not been set. Given the current economic climate, which has had an impact on all industrial sectors, it stands to reason that investors in large projects – such as this one – are watching global trends before making further time-bound commitments.”

Kalban also restated Dubal's commitment to supporting the established and planned downstream aluminium industry in the gulf region.

"Drawing on our experience over the 30 years of Dubal’s existence, we believe that downstream business clusters can play a significant role in the regional aluminium industry and its economy."

Indeed, investments in downstream manufacturing to feed mainly Middle East markets - with some international exports - have been, and continue to be, very successful,” said Kalban.

"These businesses have developed a sound business model founded on added-value products, niche markets, local market development and technology."

"Given that the major aluminium consuming markets still have excess downstream manufacturing capacity, it is important that investments in downstream industry clusters adjacent to the upcoming new regional smelters are approached in a realistic, responsible way. Otherwise, the existing and soundly-established market in this sector could be severely damaged.”

Overall, CRU 2009 was a resounding success. Acknowledged as ‘the world