EFEMoa, Cuba

Cuban nickel, one of the island's chief sources of revenue, faces some tough challenges in its need for efficiency and in its search for foreign partners to drive an industry weakened by the mineral's ebbing international prices - but has great hopes that the nation's new relations with the United States will bring great opportunities.

Cuba is among the world's top producers of the mineral, with an industry concentrated in the town of Moa, Holguin province, some 800 kilometers (500 miles) east of Havana, considered the "nickel capital" of the island.

Two extraction and processing factories operate there, one of them the Pedro Sotto Alba plant built in 1957 by a U.S. company and taken over by the Cuban government after the revolution. Since 1994 it has operated as a mixed company - Moa Nickel S.A. - a 50-50 split between the Cubaniquel monopoly and the Canadian firm Sherrit International.

With a work force of 1,936 employees, the Pedro Sotto Alba plant currently produces 37,500 tons of nickel plus cobalt, its maximum productive capacity, according to engineer Ricardo Quintana, who noted the progressive increase in production since the mixed company was set up in 1994, which planned to start out producing 24,000 tons a year.

The raw material is obtained from open-pit nickel mines in Moa municipality, where enough of the mineral exists for the next 18 to 20 years at the current rate of production.

"That will depend on efficiency, which is why the priority of the business has been focused on seeking metallurgical efficiency. Making the most of the existing nickel and cobalt," Quintana warned.

The Pedro Sotto Alba plant doesn't plan to boost production, but it does seek greater efficiency associated with cost reduction in order to compensate for the decline in nickel prices on the international market, which has dropped in recent years from $14,000 a ton to $8,000, or 45 percent less.

New relations with the United States offer new hope for the island's nickel industry, which would be, according to the head of Cubaniquel, "one of the great benefits" if Washington raises the embargo it imposes on the Caribbean island.

Nickel sales figure among the principal categories of the island's exports, trailing only professional services and tourism.

By Soledad Alvarez.