The move comes after a slump in prices of alumina, a key ingredient for aluminum production, to levels where many of the world's higher cost refiners are profitable.
The aluminum producer said it will reduce alumina output by 390,000 tons in the Atlantic region, which represents 50 percent of its global refining capacity of 18 million tons per year.
"Alcoa is taking these steps to avoid aggravating alumina oversupply in the Atlantic region and to enhance the efficiency of our refining system," Chris Ayers, president of Alcoa's global primary products division, said in a statement.
The cutback equates to raw material feed to produce about 200,000 tons of aluminum. For every ton of aluminum a producer would need two tonnes of alumina.
Alcoa said it trimmed refining output to bring it more in line with smelting output after it closed or curtailed 531,000 tonnes of annual smelting capacity in January.
Alcoa is the first producer to announce cuts in alumina output, although Norwegian aluminum group Norsk Hydro announced last month it would delay building its planned CAP alumina refinery in Brazil due to concerns about the short- and medium-term demand.
Pressure has been mounting for the industry to make capacity cuts due to the global production surplus.
Spot alumina prices in March were around $315 per ton, down from above $400, according to traders, who attributed the fall to smelter capacity cutbacks and lower London Metal Exchange prices.
Some of the world's highest-cost refineries would not be profitable at those price levels. Production in Jamaica is estimated to be at the higher end of the cost curve.
The benchmark LME aluminum price for three-month delivery was $2,094 per tonne on Thursday, off considerably from $2,325 in early March.
In January, Alcoa said it would cut its global smelting capacity by 12 percent due to a steep drop in aluminum prices.
It said it would close its Alcoa, Tennessee, smelter and two of six idled potlines in Rockdale, Texas to reduce global smelting capacity by 291,000 tons per year, or 7 percent, adding that it would find another 5 percent or 240,000 tons to curtail elsewhere.
By 1000 EDT, Alcoa shares had recovered early losses to trade at $9.84, up 0.3 percent. Alcoa's first-quarter results are due on April 10. Alcoa's stock price has fallen 46 percent since April 2011.
Aluminum prices have been creeping up slowly and rose in the first quarter of 2012 to $2,126 per tonne on March 31 from $2,020 per tonne on Jan. 1. But that is still almost 20 percent lower than a year ago.
