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Show 1 mm .. . . . ALUMINUM INDUSTRY PROSPECTS The Year 1979 was an excellent one for the aluminum industry, with the four major North American producers Alcan Aluminum, Alcoa Aluminum Company of America, Kaiser Aluminum & Chemical, Reynolds Metals showing fine sales and earnings. In the last quarter, it was obvious that a slowdown was taking place, owing largely to the decline in the automotive and construction fields. Still, the momentum that built up in the first three quarters of 1979 was enough to assure the companies peak profits for the full year. Reflecting these good gains, all of the firms hiked their dividends during 1979. A LOOK AHEAD NEAR TERM This year, what with less favorable economic conditions, aluminum shipments will likely slip below the record levels seen in 1979. Furthermore, Fur-thermore, the industry is confronted with sharply increased energy costs, a probably slackening in domestic product demand (especially from the automobile and construction fields), and the anticipated substantially higher labor costs as a result of the expiration of labor contracts next month (May 31). On the ' positive side, the top producers have all recently increased prices again to counteract the rising costs. Also, productivity within the industry has been improved, energy conservation has been stressed, and demand from aerospace, container, and electrical markets should hold up quite well this year. OVERSEAS BUSINESS BOOMING Although the domestic aluminum industry is not be any means experiencing ex-periencing a boom, the same is not true for overseas demand. Foreign buyers were recently paying more than 90 cents a pound for aluminum ingot compared with the 69 cents they were paying six months earlier. As a result, U.S. aluminum ingot exports have risen sharply. In this country, of course, major producers are constrained by government anti-inflation guildelines so our aluminum price remains far below the price overseas. The domestic price of primary ingot, however, was recently raised by 6 cents, to 72 cents a pound. The large amounts of aluminum being exported have served to tighten domestic aluminum supplies even though demand in the U.S. has slipped because of the uneasy economy. This is a situation which may well continue over the near term. BEYOND THE PRESENT It is expected that in the future the aluminum industry will grow at a more rapid rate than the overall economy, |