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AA
0001675149
3334
Primary Production of Aluminum
2,016
200
false
Iceland under a 40-year power contract. As a result of the Separation Transaction, Landsvirkjun 20 --- Table of Contents agreed to assign the power contract to Alcoa, conditioned upon Alcoa Corporation and Arconic both continuing to guarantee the obligations under the power contract. Alcoa Corporation may request Lands...
435
false
AA
0001675149
3334
Primary Production of Aluminum
2,016
201
false
the full conversion of the San Ciprián, Spain alumina refinery from fuel oil to natural gas, in October 2013, Alumina Española SA (AE) and Gas Natural Transporte SDG SL (GN) signed a take or pay gas pipeline utilization agreement. Pursuant to that agreement, the ultimate shareholders of AE, ParentCo and Alumina Limited...
476
false
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Primary Production of Aluminum
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202
false
each shareholder is responsible for its respective proportionate share (i.e., 60/40). Such commitment came into force six months after the gas pipeline was put into operation by GN. The gas pipeline was completed in January 2015 and the refinery has switched to natural gas consumption for 100% of its needs. As a result...
444
false
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0001675149
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Primary Production of Aluminum
2,016
203
false
Natural gas is supplied to the San Ciprián, Spain alumina refinery pursuant to two supply contracts with Endesa, expiring in June and December 2017, and one supply contract with Gas Natural Fenosa (GNF), expiring in December 2017. Pursuant to the Endesa agreements, Aluminio Español SL and Alumina Limited guarantee the ...
377
false
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0001675149
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Primary Production of Aluminum
2,016
204
false
responsible for its respective proportionate share (i.e., 60/40). Pursuant to the GNF agreement, Alcoa Inespal SL and Alumina Limited guarantee the payment of AE’s obligations, each shareholder being responsible for its respective proportionate share (i.e., 60/40). North America In order to supply its refinery and smel...
483
false
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Primary Production of Aluminum
2,016
205
false
areas and independent gas marketers. Pipeline transportation may be procured directly or via the local distribution companies. Contract pricing for gas is typically based on a published industry index such as the New York Mercantile Exchange (“NYMEX”) price. The Company may choose to reduce its exposure to NYMEX pricin...
468
false
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Primary Production of Aluminum
2,016
206
false
processes at the Kwinana, Pinjarra and Wagerup refineries. More than 90% of AofA’s gas requirements for the remainder of the decade are secured under long-term contracts. In 2015, AofA entered into a number of long-term gas supply agreements which secured a significant portion of AofA’s gas supplies to 2032. AofA is ac...
472
false
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Primary Production of Aluminum
2,016
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false
owned subsidiary of AofA) sold its 20% equity interest in the Dampier-to-Bunbury natural gas pipeline, which transports gas from the northwest gas fields to AofA’s alumina refineries and other users in the Southwest of Western Australia, to DUET Investment Holdings Limited. Rolled Products This segment represents Alcoa...
492
false
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Primary Production of Aluminum
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208
false
(beverage, food, and pet food). Seasonal increases in can sheet sales are generally experienced in the second and third quarters of the year. This segment also includes Alcoa Corporation’s investment in a rolling mill in Saudi Arabia through its Ma’aden joint venture; for additional information, see the Equity Investme...
481
false
AA
0001675149
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Primary Production of Aluminum
2,016
209
false
The Warrick rolling mill supports our participation in several market segments, including beverage can sheet, food can sheet, lithographic sheet, aluminum bottle sheet, and industrial products. The term “RCS” or Rigid Container Sheet is commonly used for both beverage and food can sheet. This includes the material used
321
false
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Primary Production of Aluminum
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210
false
to produce the body of beverage containers (bodystock), the lid of beverage containers (endstock and tabstock), the material to produce food can body and lids (food stock) and the material to produce aluminum bottles (bottlestock) and bottle closures (closure sheet). The U.S. aluminum can business comprises approximate...
477
false
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0001675149
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Primary Production of Aluminum
2,016
211
false
expected to be the sole domestic supplier of lithographic sheet, focusing on quality, reduced lead-times and delivery performance. In 2016, our Warrick facility produced and sold 272 kMT of RCS and industrial products, of which over 90% was sold to customers in North America. The majority of its sales were coated RCS p...
380
false
AA
0001675149
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Primary Production of Aluminum
2,016
212
false
the Separation Transaction, both Warrick and Ma’aden supply body stock material, temporarily supplemented by Arconic’s Tennessee Operations under a transition supply agreement. Can sheet demand is a function of consumer demand for beverages in aluminum packaging. Aluminum cans have a number of functional advantages for...
371
false
AA
0001675149
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Primary Production of Aluminum
2,016
213
false
carbonation retention, and logistics/distribution efficiency. Demand is mostly affected by overall demand for carbonated soft drinks (“CSDs”) and beer. CSDs and beer compose approximately 60% and 40%, respectively, of overall aluminum can demand. In recent years, CSDs sales have been declining 1% to 4% year over year. ...
484
false
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0001675149
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Primary Production of Aluminum
2,016
214
false
reached 94.3 billion cans, a growth of 1.2% over 2015. Alcoholic can shipments reached 37.9 billion cans, growing 2.6% year over year, while non-alcoholic can shipments were 56.4 billion, flat year over year. Sources and Availability of Raw Materials Generally, materials are purchased from third-party suppliers under c...
495
false
AA
0001675149
3334
Primary Production of Aluminum
2,016
215
true
For each metric ton of alumina produced, Alcoa Corporation consumes the following amounts of the identified raw material inputs (approximate range across relevant facilities): | | | | | | | --- | --- | --- | --- | --- | | | | | | | | Raw Material | | Units | | Consumption per MT of Alumina | | Bauxite | | ...
466
false
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Primary Production of Aluminum
2,016
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true
| Fuel oil and natural gas | | GJ | | 6.3 – 11.9 | | Lime (CaO) | | kg | | 6 – 70 | For each metric ton of aluminum produced, Alcoa Corporation consumes the following amounts of the identified raw material inputs (approximate range across relevant facilities): | | | | | | | --- | --- | --- | --- | --- | | | ...
490
false
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false
| Calcined petroleum coke | | mt | | 0.37 ± 0.02 | | Cathode blocks | | mt | | 0.006 ± 0.002 | | Electricity | | kWh | | 12900 – 17000 | | Liquid pitch | | mt | | 0.10 ± 0.03 | | Natural gas | | mcf | | 3.5 ± 1.5 | 22 --- Table of Contents Certain aluminum we produce includes alloying materials. Because of th...
357
false
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Primary Production of Aluminum
2,016
218
false
elements that can be used to produce our various alloys, providing a range of such elements would not be meaningful. With the exception of a very small number of internally used products, Alcoa produces its alloys in adherence to an Aluminum Association standard. The Aluminum Association, of which Alcoa Corporation is ...
489
false
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false
have other constituents as well, but of lesser amounts. Competition Alcoa is subject to highly competitive conditions in all aspects of the aluminum supply chain in which it competes. Competitors include a variety of both U.S. and non-U.S. companies in all major markets.
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false
Brand name recognition and loyalty also play a role. In addition Alcoa’s competitive position depends, in part, on the Company’s access to an economical power supply to sustain its operations in various countries. Bauxite: The third-party market for metallurgical grade bauxite is relatively new and growing quickly as g...
491
false
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Primary Production of Aluminum
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false
Alcoa has historically mined bauxite for internal consumption in our alumina refineries, we are focused on building our third-party bauxite business to meet growing demand. We sold 6.4 million tons of bauxite to a diverse third-party customer base in 2016. Competitors in the third-party bauxite market include Rio Tinto...
376
false
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Primary Production of Aluminum
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222
true
Malaysia, India and other countries. We compete largely based on bauxite quality, price and proximity to end markets. Alcoa Corporation has a strong competitive position in this market for the following reasons: | | | | | | --- | --- | --- | --- | | | • | | Low Cost Production: Alcoa is the world’s largest bauxit...
502
false
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true
| | • | | Reliable, Long-Term Bauxite Resources: Alcoa’s strategic bauxite mine locations include Australia and Brazil as well as Guinea, which is home to the world’s largest reserves of high-quality metallurgical grade bauxite. Alcoa Corporation has a long history of stable operations in these countries and has acce...
485
false
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Primary Production of Aluminum
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false
| | • | | Access to Markets: Alcoa’s Australian bauxite mines are located in close proximity to the largest third-party customer base in China and our facilities are also accessible to a significant and growing alumina refining base in the Middle East. | Contracts for bauxite
279
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Primary Production of Aluminum
2,016
225
false
have generally been short-term contracts (two years or less in duration) with spot pricing and adjustments for quality and logistics, although we are currently pursuing long-term contracts with potential customers. The primary customer base for third-party bauxite is located in Asia—particularly China. Alumina: The alu...
473
false
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2,016
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false
from a number of companies in all of the regions in which we operate, including Aluminum Corporation of China Limited, China Hongqiao Group Limited, Hindalco Industries Ltd., Hangzhou Jinjiang Group, National Aluminium Company Limited (“NALCO”), Noranda Aluminum Holding Corporation, Norsk Hydro ASA, Rio Tinto Inc., Sou...
472
false
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Primary Production of Aluminum
2,016
227
false
significant growth in alumina refining in China and India. The majority of our product is sold in the form of smelter grade alumina, with 5% to 10% of total global alumina production being produced for non-metallurgical applications. 23 --- Table of Contents Key factors influencing competition in the alumina market inc...
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true
bauxite supply, quality and proximity to customers and end markets. While we face competition from many industry players, we have several competitive advantages: | | | | | | --- | --- | --- | --- |
202
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true
| | • | | Proximity to Bauxite: Our refineries are strategically located next to low cost, upstream bauxite mines, and our alumina refineries are tuned to maximize efficiency with the exact bauxite qualities from these internal mines. In addition to refining efficiencies, vertical integration affords a stable and con...
425
false
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Primary Production of Aluminum
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230
true
| | • | | Low Cost Production: As the world’s largest alumina producer, Alcoa has competitive, efficient assets across its refining portfolio, with a 2016 average cost position in the first quartile of global alumina production. Contributing to this cost position is our experienced workforce and sophistication in ref...
403
false
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231
false
| | • | | Access to Markets: Alcoa is a global supplier of alumina with refining operations in the key markets of North America (curtailed), South America, Europe, the Middle East, and Australia, enabling us to meet customer demand in the Atlantic and Pacific basins, including China. | Contracts for smelter grade alu...
492
false
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Primary Production of Aluminum
2,016
232
false
frequent pricing adjustment. A significant development occurred in the pricing structure for alumina beginning in 2010. Traditionally, most alumina outside of China had been sold to third party smelters with the price calculated as a percentage of the LME aluminum price. In 2010, a number of key commodity information s...
386
false
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233
false
pricing assessments or indices. Since that time, Alcoa has been systematically moving its third-party alumina sales contracts away from LME aluminum-based pricing to published alumina spot or index pricing, thus de-linking the price for alumina from the aluminum price to better reflect alumina’s distinct fundamentals. ...
489
false
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Primary Production of Aluminum
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false
37% in 2012). We expect a similar percentage of our third-party alumina shipments to be based on API or spot pricing in 2017 as in 2016. Alcoa’s largest customer for smelter grade alumina is its own aluminum smelters, which in 2016 accounted for approximately 34% of its total alumina sales. Remaining sales are made to ...
459
false
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Primary Production of Aluminum
2,016
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false
The market for primary aluminum is global, and demand for aluminum varies widely from region to region. We compete with commodity traders and aluminum producers such as Aluminum Corporation of China Limited, China Hongqiao Group Limited, East Hope Group Co. Ltd., Emirates Global Aluminum, Norsk Hydro, Rio Tinto Alcan I...
376
true
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false
Investment Co. (“SPIC”), United Company RUSAL Plc as well as with alternative materials such as steel, titanium, copper, carbon fiber, composites, plastic and glass, each of which may be substituted for aluminum in certain applications. The aluminum industry itself is highly competitive; some of the most critical compe...
372
false
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0001675149
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Primary Production of Aluminum
2,016
237
false
production costs (including source and cost of energy), price, proximity to customers and end markets, timeliness of delivery, customer service (including technical support), and product innovation and breadth of offerings. Where aluminum products compete with other materials, the diverse characteristics of aluminum ar...
398
false
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false
In addition, in some end-use markets, competition is also affected by customer requirements that suppliers complete a qualification process to supply their plants. This process can be rigorous and may take many months to complete. However, the ability to obtain and maintain these qualifications can represent a competit...
473
false
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Primary Production of Aluminum
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true
and the lack of localized customer support. There is a growing trade in higher value-added products, with recent trade patterns seeing more flow toward the deficit regions. However, suppliers in emerging markets may export lower value-added or even commodity aluminum products to larger, more mature markets, as we have ...
496
false
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true
| | • | | Value-Added Product Portfolio: Alcoa Corporation has 15 casthouses supplying global customers with a diverse product portfolio, both in terms of shapes and alloys. We have steadily grown our cast products business by offering differentiated, value-added aluminum products that are cast into specific shapes t...
481
false
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false
| | • | | Low Cost Production: As the world’s sixth largest aluminum producer in 2016, Alcoa leverages significant economies of scale in order to continuously reduce costs. As a result, Alcoa operates competitive, efficient assets across its aluminum smelting and casting portfolios, with its 2016 average smelting cos...
383
false
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true
This cost position is supported by long-term energy arrangements at many locations; Alcoa Corporation has secured approximately 68% of its smelter power needs through 2022. | | | | | |
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true
| --- | --- | --- | --- | | | • | | Access to Markets: Alcoa is a global supplier of aluminum with smelting and casting operations in the key markets of North America, Europe, the Middle East, and Australia, enabling us to access a broad customer base with competitive logistics costs. | | | | | | | --- | --- | --...
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| | • | | Sustainability: As of December 31, 2016, approximately 70% of our aluminum smelting portfolio runs on clean hydroelectric power, lessening our demand for fossil fuels and potentially mitigating the risk to the Company from future carbon tax legislation. | Contracts
278
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false
for primary aluminum vary widely in duration, from multi-year supply contracts to monthly or weekly spot purchases. Pricing for primary aluminum products is typically comprised of three components: (i) the published LME aluminum price for commodity grade P1020 aluminum, (ii) the published regional premium applicable to...
469
true
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false
and aluminum, electricity markets are regional. They are limited in size by physical and regulatory constraints, including the physical inability to transport electricity efficiently over long distances, the design of the electric grid, including interconnections, and by the regulatory structure imposed by various fede...
476
false
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false
Brazilian wholesale energy markets. Our competitors include integrated electric utilities that may be owned by governments (either fully or partially), cooperatives or investors, independent power producers and energy brokers and traders. Competition factors in open power markets include fuel supply, production costs, ...
375
false
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false
environmental attributes (e.g., green power and renewable energy credits). As electricity is difficult and cost prohibitive to store, there are no electricity inventories to cushion the impact of supply and demand factors and the resultant pricing in electricity markets may be volatile. Demand for power varies greatly ...
474
false
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false
planned generator outages, droughts, high precipitation levels and fuel pricing (coal and/or natural gas). Electricity contracts may be very short term (real-time), short term (day ahead) or years in duration, and contracts can be executed for immediate delivery or years in advance. Pricing may be fixed, indexed to an ...
495
false
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Primary Production of Aluminum
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true
unit delivered basis (e.g., dollars per megawatt hour) or the components may be separated and include a demand or capacity charge, an energy charge, an ancillary services charge and a transmission charge to make the delivered energy conform to customer requirements. Alcoa’s energy assets enjoy several competitive advan...
407
false
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| | • | | Reliability: In the United States, we have operated our thermal energy assets for over 50 years and our hydro energy assets for over 95 years with a high degree of reliability and expect to continue this level of performance. In Brazil, our ownership provides for assured energy from hydroelectric operations...
385
false
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true
| | • | | Access and proximity to markets: Our U.S. assets are positioned to take advantage of sales into some of the more liquid power markets, including sales of both energy and capacity. | | | | | | | --- | --- | --- | --- | | | • | | Sustainable (green) energy sources: A majority of our generating assets us...
500
false
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Primary Production of Aluminum
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false
Rolled Products participates in various market segments, including beverage can sheet, food can sheet, lithographic sheet, aluminum bottle sheet, and industrial products. The term “RCS” or Rigid Container Sheet is commonly used for both beverage and food can sheet. The Warrick rolling mill competes with other North Ame...
353
false
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Primary Production of Aluminum
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false
namely Novelis Corp, Tri-Arrows Aluminum, and Constellium NV. The Warrick rolling mill is expected to be the sole domestic supplier of lithographic sheet, focusing on quality, reduced lead-times and delivery performance. Buyers of RCS products in North America are large and concentrated and have significant market powe...
373
false
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false
can sheet sold in the beverage industry (three can makers and the two beverage companies). In 2016, we estimate the North American (Canada/U.S./Mexico) aluminum can sheet buyers and their share of the industry are: AB-Inbev (>39%), Coke (>21%), Ball (>18%), Crown (>15%), Ardagh (>5%) and others (2%). Buyers traditional...
474
false
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false
approximately 60% of their manufacturing costs, there is a heavy focus on cost. In 2016, our Warrick facility produced and sold 272 kMT of RCS and industrial products, of which over 90% was sold to customers in North America. The majority of its sales were coated RCS products (food stock, beverage end and tab stock). F...
506
false
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false
We also compete with competitive package types including PET bottles, glass bottles, steel tin plate and other materials. In the U.S., aluminum cans, PET bottles and glass bottles represent approximately 69%, 29% and 2%, respectively, of the CSDs segment. In the beer segment, aluminum cans, glass bottles, and aluminum ...
392
false
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false
the business. In the food can segment, steel tin plate cans and aluminum food cans represent approximately 83% and 17%, respectively, with aluminum cans representing approximately 52% of the pet food segment. We compete on cost, quality, and service. Alcoa Corporation intends to continue to improve our cost position by...
361
false
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our metal feedstock as well as continuing to focus on capacity utilization. We believe our team of technical and operational resources provides distinctive quality and customer service. Patents, Trade Secrets and Trademarks The Company believes that its domestic and international patent, trade secret and trademark asse...
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them, are important to the Company as a whole and, to varying degrees, important to each business segment. Alcoa’s business as a whole is not, however, materially dependent on any single patent, trade secret or trademark. As a result of product development and technological advancement, the Company continues to pursue ...
427
false
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false
portfolio consisted of approximately 600 granted patents and 285 pending patent applications. The Company also has a number of domestic and international registered trademarks that have significant recognition within the markets that are served, including the name “Alcoa” and the Alcoa symbol for aluminum products. Our...
450
false
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false
As part of the Separation Transaction, two Arconic businesses, Alcoa Wheels and Spectrochemical Standards, have ongoing rights to use the Alcoa name. See “Certain Relationships and Related Party Transactions, and Director Independence—Agreements with Arconic—Intellectual Property License Agreements.” Research and Devel...
496
false
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false
Corporation is subject to extensive federal, state and local environmental laws and regulations, including those relating to the release or discharge of materials into the air, water and soil, waste management, pollution prevention measures, the generation, storage, handling, use, transportation and disposal of hazardo...
496
true
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false
and cleanups at approximately 60 locations. These include owned or operating facilities and adjoining properties, previously owned or operating facilities and adjoining properties, and waste sites, including Superfund (Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”)) sites. Approved capi...
479
false
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false
Additional information relating to environmental matters is included in Note R to the Consolidated Financial Statements under the caption “Contingencies and Commitments—Environmental Matters.” Employees Alcoa’s total worldwide employment at the end of 2016 was approximately 14,000 employees in 15 countries. Approximate...
501
false
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false
In the U.S., approximately 1,950 employees are represented by various labor unions. The largest collective bargaining agreement is the master collective bargaining agreement with the United Steelworkers (“USW”). The USW master agreement covers approximately 1,400 employees at six U.S. locations. There are three other c...
330
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false
bargaining agreements in the U.S. with varying expiration dates. On a regional basis, collective bargaining agreements with varying expiration dates cover approximately 2,100 employees in Europe, 2,000 employees in Canada, 850 employees in Central and South America, and 2,750 employees in Australia. 27 --- Table of Con...
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false
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Roy C. Harvey, 43, is the Chief Executive Officer of Alcoa Corporation. Mr. Harvey served as Executive Vice President of ParentCo and President of ParentCo’s Global Primary Products from October 2015 to November 2016. From June 2014 to October 2015, he was Executive Vice President, Human Resources and Environment, Heal...
432
false
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Primary Products at ParentCo from July 2013 to June 2014, and was Chief Financial Officer for Global Primary Products from December 2011 to July 2013. In addition to these roles, Mr. Harvey served as Director of Investor Relations at ParentCo from September 2010 to November 2011 and was Director of Corporate Treasury f...
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false
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William F. Oplinger, 50, is Executive Vice President and Chief Financial Officer of Alcoa Corporation. Mr. Oplinger served as Executive Vice President and Chief Financial Officer of ParentCo from April 1, 2013 to November 2016. Mr. Oplinger joined ParentCo in 2000 and held key corporate positions in financial analysis ...
376
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Mr. Oplinger also held key positions in the ParentCo’s Global Primary Products business, including as Controller, Operational Excellence Director, Chief Financial Officer, and Chief Operating Officer. Tómas M. Sigurðsson, 49, is Executive Vice President and Chief Operating Officer of Alcoa Corporation. Mr. Sigurðsson s...
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as Chief Operating Officer of ParentCo’s Global Primary Products business from 2014 to November 2016. Mr. Sigurðsson was President of ParentCo’s European Region and Global Primary Products Europe from 2012 to 2014. From 2004 to 2011, Mr. Sigurðsson was Managing Director of Alcoa Iceland. Leigh Ann Fisher, 50, is Execut...
353
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false
Administrative Officer, overseeing Human Resources, Shared Services, Procurement and Information Technology of Alcoa Corporation. Ms. Fisher served as Chief Financial Officer of ParentCo’s Global Primary Products business from July 2013 to November 2016. Ms. Fisher was Group Controller for Global Primary Products at Pa...
456
false
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Jeffrey D. Heeter, 51, is Executive Vice President, General Counsel and Secretary of Alcoa Corporation. Mr. Heeter served as Assistant General Counsel of ParentCo from 2014 to November 2016. Mr. Heeter was Group Counsel for Global Primary Products at ParentCo from 2010 to 2014. From 2008 to 2010, Mr. Heeter was General...
495
false
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false
previously served as the Director, Global Shared Services Strategy and Solutions for Alcoa Corporation, with responsibility for the strategy, planning and implementation of transformation activities for Alcoa Corporation’s shared services organization beginning in November 2016. From January through October of 2016, pr...
474
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AA
0001675149
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Primary Production of Aluminum
2,016
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of the Separation Transaction. From 2012 to 2015, she served as Vice President, Finance and Administration for a non-profit organization focused on community issues. Ms. Beerman first joined ParentCo in 2001, and was the director of ParentCo’s global procurement center of excellence from 2008 to 2012. Item 1A.  Risk Fa...
454
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Primary Production of Aluminum
2,016
277
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factors discussed elsewhere in this report, the following risks and uncertainties could materially harm its business, financial condition or results of operations, including causing Alcoa’s actual results to differ materially from those 28 --- Table of Contents projected in any forward-looking statements. The following...
459
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0001675149
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Primary Production of Aluminum
2,016
278
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presently known to Alcoa or that Alcoa currently deems immaterial also may materially adversely affect us in future periods. Risks Related to Our Business The aluminum industry and aluminum end-use markets are highly cyclical and are influenced by a number of factors, including global economic conditions. The aluminum ...
413
false
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0001675149
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Primary Production of Aluminum
2,016
279
false
in global economic conditions and aluminum end-use markets. The demand for aluminum is sensitive to, and quickly impacted by, demand for the finished goods manufactured by our customers in industries that are cyclical, such as the commercial construction and transportation, automotive, and aerospace industries, which m...
486
false
AA
0001675149
3334
Primary Production of Aluminum
2,016
280
false
correlated to economic growth. For example, the European sovereign debt crisis that began in late 2009 had an adverse effect on European demand for aluminum and aluminum products. The Chinese market is a significant source of global demand for, and supply of, commodities, including aluminum. A sustained slowdown in Chi...
492
false
AA
0001675149
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Primary Production of Aluminum
2,016
281
false
emerging economies, such as India, Brazil, and several South East Asian countries, could have an adverse effect on the global supply and demand for aluminum and aluminum prices. While we believe the long-term prospects for aluminum and aluminum products are positive, we are unable to predict the future course of indust...
379
false
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0001675149
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Primary Production of Aluminum
2,016
282
false
effects of government intervention. Negative economic conditions, such as a major economic downturn, a prolonged recovery period, a downturn in the commodity sector, or disruptions in the financial markets, could have a material adverse effect on our business, financial condition or results of operations. While the alu...
386
false
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Primary Production of Aluminum
2,016
283
false
and bauxite markets, those markets also have industry-specific risks including, but not limited to, global freight markets, energy markets, and regional supply-demand imbalances. The aluminum industry specific risks can have a material effect on profitability for the alumina and bauxite markets. We could be materially ...
503
false
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0001675149
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Primary Production of Aluminum
2,016
284
false
(i) the underlying base metal component, which is typically based on quoted prices from the LME; (ii) the regional premium, which comprises the incremental price over the base LME component that is associated with the physical delivery of metal to a particular region (e.g., the Midwest premium for metal sold in the Uni...
481
false
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0001675149
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Primary Production of Aluminum
2,016
285
false
rod, etc.) or alloy. Each of the above three components has its own drivers of variability. The LME price is typically driven by macroeconomic factors, global supply and demand of aluminum (including expectations for growth and contraction and the level of global inventories), and trading activity of financial investor...
483
false
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0001675149
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Primary Production of Aluminum
2,016
286
false
pricing. Speculative trading in aluminum and the influence of hedge funds and other financial institutions participating in commodity markets have also increased in recent years, contributing to higher levels of price volatility. In 2016, the cash LME price of aluminum reached a high of $1,777 per metric ton and a low ...
469
false
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Primary Production of Aluminum
2,016
287
false
aluminum. Declines in the LME price have had a negative impact on our results of operations. Additionally, our results could be adversely affected by decreases in regional premiums that participants in the physical metal market pay for immediate delivery of aluminum. Regional premiums tend to vary based on the supply o...
357
false
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Primary Production of Aluminum
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288
false
demand for metal in a particular region and associated transportation costs. LME warehousing rules and surpluses have caused regional premiums to decrease, which would have a negative impact on our results of operations. Product premiums generally are a function of supply and demand for a given primary aluminum shape a...
433
false
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Primary Production of Aluminum
2,016
289
false
pricing environment. A sustained weak LME aluminum pricing environment, deterioration in LME aluminum prices, or a decrease in regional premiums or product premiums could have a material adverse effect on our business, financial condition, and results of operations or cash flow. Most of our alumina contracts contain tw...
376
true
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Primary Production of Aluminum
2,016
290
false
negotiated adjustment basis that takes into account various factors, including freight, quality, customer location and market conditions. Because the API component can exhibit significant volatility due to market exposure, revenue associated with our alumina operations are exposed to market pricing. Our bauxite-related...
494
false
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Primary Production of Aluminum
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291
false
revenue associated with our bauxite operations may become further exposed to market pricing. Changes to LME warehousing rules could cause aluminum prices to decrease. Since 2013, the LME has been engaged in a program aimed at reforming the rules under which registered warehouses in its global network operate. The initi...
497
false
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Primary Production of Aluminum
2,016
292
false
warehouse charges. These rule changes, and any subsequent changes the exchange chooses to make, could impact the supply/demand balance in the primary aluminum physical market and may impact regional delivery premiums and LME aluminum prices. Decreases in regional delivery premiums and/or decreases in LME aluminum price...
437
false
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Primary Production of Aluminum
2,016
293
false
We may not be able to realize the expected benefits from our strategy of creating a lower cost, competitive commodity business by optimizing our portfolio. We are continuing to execute a strategy of creating a lower cost, competitive integrated aluminum production business by
283
false
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Primary Production of Aluminum
2,016
294
false
optimizing our portfolio. We are creating a competitive standalone business by taking decisive actions to lower the cost base of our upstream operations, including closing, selling or curtailing high-cost global smelting capacity, optimizing alumina refining capacity, and pursuing the sale of our interest in certain ot...
379
false
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Primary Production of Aluminum
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295
false
execute, acquisitions and divestitures and take other actions to grow or streamline our portfolio. There is no assurance that anticipated benefits of our strategic actions will be realized. With respect to portfolio optimization actions such as divestitures, curtailments and closures, we may face barriers to exit from ...
479
false
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Primary Production of Aluminum
2,016
296
false
divested entities if a buyer fails to honor all commitments. Our business operations are capital intensive, and curtailment or closure of operations or facilities may include significant charges, including employee Separation Transaction costs, asset impairment charges and other measures. There can be no assurance that...
488
false
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0001675149
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Primary Production of Aluminum
2,016
297
false
Market-driven balancing of global aluminum supply and demand may be disrupted by non-market forces or other impediments to production closures. In response to market-driven factors relating to the global supply and demand of aluminum and alumina, we have curtailed or closed portions of our aluminum and alumina producti...
510
true
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Primary Production of Aluminum
2,016
298
false
contracts to buy power or raw materials. 30 --- Table of Contents The existence of non-market forces on global aluminum industry capacity, such as political pressures in certain countries to keep jobs or to maintain or further develop industry self-sufficiency, may prevent or delay the closure or curtailment of certain...
420
false
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Primary Production of Aluminum
2,016
299
false
Chinese excess capacity and increased exports from China of heavily subsidized aluminum products could materially disrupt world aluminum markets causing pricing deterioration. If industry overcapacity exists due to the disruption by such non-market forces on the market-driven balancing of the global supply and demand o...
451
false