Mining giant Rio Tinto has said this morning that it is to suspend production at its Gove alumina refinery, as the current market environment means it's no longer a viable business. The news comes a day after the firm led the FTSE, having announced that it's to save $3bn on its iron ore ramp up.
Falling alumina prices, a high exchange ray and substantial after-tax losses were factors informing the company's decision for the Northern Territory refinery.
Rio Tinto will work with authorities and traditional owners in a bid to minimise the impact of change for the region. Focus will remain on its bauxite operations, which it sees as key to retaining a sustainable business in the area.
In its statement, the firm said that "establishing long-term certainty" for the 350 employees at the bauxite operation will be "a priority". The fate of Gove's 1,400 jobs was not detailed.
Chief executive Sam Walsh said that Rio Tinto "recognise[s] it will have a significant impact on our employees, the local community and the Northern Territory", adding that there is "no doubt it is a challenging path ahead."
Suspending production is likely to take some time, with the process beginning in the first quarter of 2014 and increasing over the year.