German Copper Company Merges Operations

Norddeutsche Affinerie AG, a Germany-based copper and metals company, is taking steps to strength its metal recycling business. The step being taken is to consolidate NA’s smelters with Huttenwerke Kayser AG’s operations in Lunen, Germany. NA is the majority shareholder of HK.

 “NA is responding to the increased requirements of international competition and the structural changes in the copper market by implementing group-wide structural changes and enforcing cost cutting and performance enhancement programs. By 2006 measures will be taken with a potential improvement in earnings of about 80 million Euros per year,” said Werner Marnette, CEO.

The move will allow NA to take over the central role in strengthening its recycling business. “We will thus enhance our leading position in the recycling market even further", Marnette added.

In the future all NA’s marketing activities in its recycling business will be centrally controlled from Lünen under the management of Hans-Gerhard Hoffmann.

The company also stated that is has developed a clear strategy to deal with the volatile scrap market. The company noted that it will no longer focus exclusively on scrap markets. Rather, the company said it will also look at the marketing opportunities of overall recycling services. These may focusing more strongly on business with industrial waste collection points.

While these moves will help improve the company’s performance, the refining charges for copper scrap dropped to an historical low with the result that HK showed significant losses. These losses resulted in roughly one third of HK’s staff was layed off.

With rising copper prices and a slight economic upturn in Europe the market for copper scrap is improving. The economic outline conditions are also meanwhile better than in the previous year. Global copper demand is rising, primarily in Asia and other growth markets, but also in Europe where it should amount to 5 percent in 2004. Copper is meanwhile in short supply worldwide. The present price trend documents this. This higher demand and the increased copper quotations will have a positive impact on the international raw material markets in the current year.