Energy risk escalates for European metal producers

With no clear near-term solution for the energy crisis in Europe, there is a tangible risk that metal producers will be forced to close. There have already been casualties among primary producers, and the prospect of a long-lasting energy crunch raises the risk of further curtailments. Aluminium and zinc producers have been the first to reduce production as a direct consequence of high energy costs. Steel mills also reduced production due to high production costs and a weakening market environment. So far copper producers have been the least impacted, as energy flexibility and healthy revenues from sulphur by-products and energy credits have put them in a better position to survive high energy costs.