short answer pleaSe

Norsk Hydro Unlike smaller aluminium producers, the strategies of the world's four largest aluminium companies are skewed towards the long-term (the next 5-10 years). In line with such long-term planning are included costs saving programmes, usually performed over 3 and more years. A concrete example of that is signing long term electricity supply contracts (for up to 20 years), which enables the Big 4 to obtain electricity supplies at much lower rates than those obtained by smaller producers - think, KAP- Montenegro or Aluminij Mostar - that can only obtain electricity supplies for one year, at prices just slightly lower than the market price. A similar situation occurs with raw materials, where big producers obtain significant discounts by signing long-term agreements for alumina and carbon, for example. What's more, the Big 4 have several other advantages over small producers: they tend to have their own power plants, which not only insulate them from market conditions but are able to provide electricity for most of their production This is the reason why big producers are in much better positions in volatile market conditions and especially during crises, than their smaller counterparts. Production costs for aluminium smelters have increased in the second half of last year and in Q1 2017, alongside the rising LME aluminium price, but so did alumina prices and other input/raw material costs. Still, the aluminium price rose at a faster clip, resulting in much higher operating and net profits for all main producers in the first quarter (1) 2017 compared to the same period in 2016, or even compared to Q4 2016. Hydro's main strategy is focused on reducing the risks stemming from weak economic and unfavourable market conditions by improving its cost position as well as maintaining a solid financial position and strong credit worthiness. Hydro's integrated value chain plays a key role in mitigating those risks as the earnings volatility in the upstream aluminium is typically higher, whereas downstream and energy businesses generate more stable earnings over time. To that end, the strategy is pursuing high grading and shifting the product portfolio towards higher margin segments. Especially in rolled products this has resulted in a special focus on the high-growth automotive market, and production has recently started at the new Automotive Line 3 in Grevenbroich, Germany. In the first quarter of 2016, the rolled products division signed a multi-year contract for deliveries to UK-based carmaker Jaguar Land Rover Hydro's climate strategy is an integral part of its overall business strategy, which includes reducing the environmental impact of its production activities. The company's goal is to be carbon neutral in a life cycle perspective by 2020, the target to be achieved mainly through: . Increased production of primary aluminium in Norway, which is based on hydropower Increased recycling Increased delivery to the automotive sector Under the "Better Primary Metal" initiative, Hydro is targeting annual savings for its entire smelter portfolio of NOK 1 billion (US$ 120 million) by the end of 2019, compared to 2015 levels. This includes increasing production capacity at existing smelters through proven technological developments in addition to continuous operational improvements and fixed and variable cost reductions. The primary metal segment has already sold around 50% of its expected primary aluminium production for the second quarter of 2017, at an average price level of US$ 1875 per tonne. Hydro's earnings before financial items were US$ 271 million in the first quarter, up from US$ 220.6 million in the Q4 2016. The increase mainly reflected higher realised all-in aluminium and alumina prices, somewhat offset by higher raw material costs However, Q1 results came in lower than expected by a pool of Reuters analysts, with all six divisions missing forecasts. For its most important division, primary metal, Norsk Hydro blamed "significantly higher alumina costs. The cost of fuel oil, caustic soda, carbon and other raw materials also increased and was responsible for Norsk's weak results. Underlying EBIT for rolled products was influencer by various operational issues related to starting up production after year-end maintenance ani implementation of new equipment at new automotive parts line in Germany. QUESTION 1 Analyze the importance that entering goods have for Hydro's overall financial performance