Rayon Dyer, Gleaner Writer

The Alpart Kirkvine bauxite plant in Manchester is seen in this September 15, 2004 aerial photograph. Alberto Fabrini has said a 33 per cent decline in the price of aluminium is having a negative effect on the Jamaican bauxite sector. - File

GLOBAL ECONOMIC turbulence is threatening the short-term survival of Jamaica's bauxite industry.

Managing director of Alumina Partners of Jamaica (Alpart), Alberto Fabrini, is reporting a substantial decline in alumina prices while Opposition Spokesman on Mining Michael Peart has said the short-term prospects of the industry are bleak.

"We have seen a 33 per cent slide in aluminium prices since June and, of deeper local interest, is the fact that prices for alumina, which we produce, have fallen accordingly," Fabrini said.

He was speaking at the induction ceremony of the central chapter of the Press Association of Jamaica (PAJ) at the start of Journalism Week. The ceremony was held at the Alpart Sports Club at Nain, St Elizabeth on Sunday.

Fallout fears

On Monday, the Opposition People's National Party (PNP) chided the Government for not clearly articulating a strategy to prevent greater fallout in the alumina market.

"It appears that they are just keeping their fingers crossed and hoping for the best that we are at the bottom of the crisis and things will soon return to normal," Peart said in a release.

According to Peart, all the indicators show that "the fall is continuing and the recovery is nowhere in sight".

As recession sweeps the globe, downturn in manufacturing has slowed demand for aluminium. Aluminium prices fell from a high earlier this year of over US$3,200 per tonne to just over US$1,700 per tonne on the London Metal Exchange.

( L - R ) Fabrini, Peart

Fabrini on Sunday noted that Jamaica has high stakes in keeping the bauxite/alumina industry afloat.

"It behoves us to keep a sharp and watchful eye on these developments," he said in reference to the impact of the financial meltdown on the bauxite sector.

"As you are aware, the industry is going through an interesting period, to say the least, and it is at times like this that we need that clarity and accurate reporting of events that only the media can provide," he said.

Fabrini also said the bauxite industry had been the lynchpin of Jamaica's economy for nearly 60 years. Last year, the country's biggest gross merchandise earner provided US$1.3 billion.

He said the sustainability of the industry was important to Jamaica's interests and stakeholders in the industry, including the media, as well as the government, owners and employees. Fabrini also urged the community to collaborate in shoring up the sector's viability.

He added that, with the threatening crisis, Alpart had taken a series of initiatives to better manage its costs through improvement in its processes and reduction on non-critical capital projects.

However, Peart is adamant that local companies may be pushed to the edge.

He said Russian company, Rusal, the majority owner in Windalco and Alpart, is in financial difficulties. Last week, the Russian government dispatched auditors to check Rusal's financial management.

Peart said that, while the alumina industry is hard pressed to survive now, the long-term prospects remain great.

"The challenge, therefore, is to stay alive and weather this period and be in a position to benefit from the recovery," Peart said.

Mining and Telecommunications Minister Derrick Smith was overseas receiving medical treatment and was not available for comment.