Fitch Downgrades Jamaica’s CAP

Fitch has downgraded Clarendon Alumina Production, which the government of Jamaica owns, to B minus from B. It also revised the outlook to negative from stable. The cuts follow the downgrade of the sovereign by Fitch to B with negative outlook, Fitch says. “CAP ended the financial year with a negative $34.7m operating Ebitda position, primarily a reflection of high production costs in relation to caustic soda and fuel inputs and CAP’s inability to pass them through to end customers, largely due to inflexible long-term supply contracts with its main customer Glencore, ending 2010 and 2012 respectively. As a result of these long-term contracts, CAP was unable to benefit from the high spot prices seen for alumina during the last two years,” Fitch explains.