By Jesus Calero and Tomasz Kanik
(Reuters) -Norwegian aluminium producer Norsk Hydro cut its 2025 capital spending guidance by 1.5 billion crowns ($147.5 million) and froze external white-collar hiring on Tuesday, as input costs are volatile and demand uncertain due to U.S. tariffs.
U.S. tariffs on aluminium have roiled trade flows and pushed physical market premiums to record highs, amplifying cost pressures for American buyers and redrawing global supply lines.
The Norwegian firm plans to cut more than 100 jobs at its Hydro Extrusions division by 2025, prioritising operational efficiency and cost control.
“We have so far not seen big changes to our operations from tariffs and potential trade wars. Our main concern is whether the uncertainty will lead to a global economic downturn,” CEO Eivind Kallevik said in a statement.
Hydro reported a 33.4% rise in second-quarter core profit, helped by higher aluminium and energy prices, and despite cost pressures from pricier raw materials, notably alumina, as well as forex rate impact.
Its shares were up 3.5% in early trading in the pan-European 600 index.
Order bookings for some business areas showed early signs of improvement, especially for domestic producers benefiting from lower imports, the company said.
The results beat expectations despite weakness at the bauxite and alumina and aluminium metal divisions, as the so-called other and eliminations segment bolstered earnings, analysts said.
The U.S. remains heavily reliant on imports, with Canada alone supplying over two-thirds of its aluminium. The new 50% levies have made it costlier to bring in foreign metal into the world’s largest economy.
With Chinese smelters churning out record volumes of aluminium and looking to offload surplus abroad, barriers in the West have offered short-term relief to companies like Hydro by lifting regional premiums and curbing low-cost competition.
Hydro’s adjusted earnings before interest, taxes, depreciation and amortisation rose to 7.79 billion Norwegian crowns in April-June from 5.84 billion crowns a year earlier.
Analysts on average had expected it to report a core profit of 7.30 billion crowns, according to a company-compiled consensus.
The company’s 2025 capital spending guidance now stands at 13.5 billion crowns.
($1 = 10.1730 Norwegian crowns)
(Reporting by Jesus Calero and Tomasz Kanik; Editing by Mrigank Dhaniwala)
