Reuters reported that Noranda Aluminum Holding Company expects Q3 demand for the metal to be similar to the Q2.

Mr Kip Smith CEO of Noranda said that it's impossible to forecast price but what's reasonable to expect is a steady demand pattern from the Q2 to the Q3. Typically, our strongest quarters are the second and third and I think this will be a typical year for our demand pattern. He said that we are bullish on the outlook in the medium and long term.

Noranda emerged as a publicly traded company in May after an IPO by its majority owner, the private equity firm Apollo Management LP. The IPO priced at the bottom of the expected range after being earlier delayed. The company sold 10 million shares for USD 8 each, rising about USD 80 million which it used to pay down debt. It had originally planned to sell 16.67 million shares for USD 14 to USD 16 each.

Mr Smith said while asking about the lower IPO price and whether the company had considered putting off going public, that clearly the price we went out at was less than the range. But it was still clearly within the boundaries of what was acceptable to us and now we've had the opportunity to build that track record and we've had our Q1. We feel it was appropriate timing. It was a difficult week we were out and market conditions were very challenging.

He noted that the IPO was done at a time when the price of aluminum in London has dropped sharply. It went from over USD 2,400 per tonne in April to around USD 2,000 as weak demand for cars, planes and construction and uncertainty over the strength of the global recovery have weighed on the metal.

Noranda operates a mine in Jamaica to produce bauxite which is refined into alumina at its Gramercy, Louisiana facility. The alumina is then smelted into aluminum at Noranda's smelter near New Madrid, Missouri. Besides the primary metals or upstream business, Noranda also has downstream businesses producing rolled products at four rolling mill facilities in Tennessee, North Carolina and Arkansas.

Mr Smith said that the company had plans to expand its smelter to produce an extra 30 million pounds or about 5% of its annual 580 million pound aluminum production. But because of the recession, the plans were still on hold but would go ahead after evaluation at the appropriate time given market conditions.

(Sourced from Reuters)