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February 2023

2022 Global Aluminum Industry Research Report


2022 Global Aluminum Industry Research Report


The aluminum industry is an industry that produces and sells aluminum products. Aluminum (Aluminium) is a metal element, and the most abundant metal element in the earth’s crust. Among all metal varieties, aluminum output ranks the third just behind steel and iron globally. It has special chemical and physical properties. It is not only light in weight and strong in texture, but also has good ductility, electrical conductivity, thermal conductivity, heat resistance and nuclear radiation resistance. It is an important raw material for economic development in many countries and areas.

For past five decades, aluminum has became one of the most widely used metals in the world. Especially in the construction, transportation and packaging industry; the aluminum consumption of these three major industries generally takes for about 60% of the total annual consumption.

In the construction industry, due to the its stability and the excellent appearance after anodizing, aluminum is getting more and more popular in constructions, especially in aluminum alloy doors and windows, aluminum-plastic pipes, decorative panels , aluminum curtain wall and other applications.

In the transportation industry, in order to reduce the weight of the vehicle itself, like motorcycles, various automobiles, trains, subways, airplanes, ships and other transportation vehicles have begun to use aluminum and aluminum alloys as components and decorative parts in large quantities. As the hardness and strength of aluminum alloy processing materials continue to increase, the proportion used in the aerospace field has begun to increase year by year.
In the packaging industry, the scope of aluminum for various flexible packaging, all-aluminum cans, various bottle caps and easy-open lids, and pharmaceutical packaging is also expanding. In other consumer fields, the usage and prospect of electronic appliances, household appliances (refrigerators, air conditioners), daily hardware, etc. are rapidly growing as well.

Global Aluminum Industry

Since the second half of 2017, the international aluminum price has risen tremendously, aluminum product manufacturers and suppliers have improved a lot, and shut-down production firms had begun to restart one after another. According to statistics from the Commodities Research Unit (CRU), the total global electrolytic aluminum production in 2018 was 63.82 million tons, which is a 0.57% increase comparing to the last year. The top 5 countries in terms of global production are China, Russia, India, Canada and the United Arab Emirates. In 2018, the output of these five countries accounted for 77.4% of the world.

The consumption of electrolytic aluminum outside China maintained a steady growth. Consumption is broken down by continent, with Asia by far the world’s leading consumer of refined aluminum, with consumption exceeding 50 million metric tons in 2020.

Europe was the second largest consumer of refined aluminum at 7.36 million metric tons that year. Except for the obvious decrease in consumption in South America, other regions have increased to varying degrees. Among them, the consumption of refined aluminum in Oceania, Europe and Asia has increased significantly, and they are the main regions that stimulate foreign consumption.

Bauxite Mining

Bauxite is the main source of aluminum in the world. The ore must first be chemically treated to produce alumina. The Bayer process is a common method for extracting bauxite. Alumina is obtained when impurities are removed from bauxite, which forms the raw material for making aluminium. Refined alumina is processed in an electrolytic process to produce liquid aluminum, which is then given different shapes and sizes.

Global bauxite resources are estimated at 55 to 75 billion tonnes, and at current mining rates these reserves will last for 250 to 340 years.

From the perspective of the distribution of global bauxite reserves, Guinea and Australia has the most of the global bauxite reserves, sharing about 44% of the total. Guinea, Australia, Vietnam, Brazil and Jamaica together accounted for 72%. According to statistics, bauxite can still be mined for about another 100 yeasrs. Generally speaking, the global supply of bauxite is sufficient, so the supply side of aluminum will not be restricted by the raw material side in the next few decades, but by the low-carbon energy side. Environmental friendly.

However, the actual output, Australia, Guinea, and Brazil is almost consistent with the proportion of reserves, while the proportion of China’s production (16%) is far greater than the proportion of China’s reserves, indicating that China’s bauxite is being overdrawn. In the next ten years, 64% of the world’s bauxite production is expected to come from Guinea, 24% from Australia, and 12% from Indonesia, so the proportion of Guinea’s bauxite production is expected to expand in the future.

2022 Global Aluminum Industry Research Report2023-02-21T03:40:38+00:00

Turkish Earthquake and Its Metal Industry


Turkish Earthquake and Its Metal Industry

On February 6, two 7.8-magnitude earthquakes hit Turkey, an important trade center connecting Asia, Europe and even the world. The focal depth of this strong earthquake was 20 kilometers, and the epicenter was located at 37.35 degrees north latitude and 36.85 degrees east longitude. The strong earthquake caused severe damage in Turkey, killing more than 4,000 people. Therefore, we want to look at the impact of the Turkish earthquake on metals by sorting out the supply, demand and trade of non-ferrous and ferrous metals in Turkey.

At the present, the impact of the earthquake in Turkey on the supply and demand pattern of non-ferrous metals and ferrous metals is relatively limited, but Turkey is the center of Asia-Europe trade, and the earthquake will have a certain adverse impact on its transportation and trade. From the perspective of non-ferrous varieties, no matter in terms of output or demand, Turkey’s non-ferrous metal production and sales account for a very small proportion of the world. Therefore, it has no obvious impact on the supply and demand pattern of non-ferrous metals in my country or the world; but from Turkey’s In terms of trade flow, Turkey exports zinc and stainless steel products to Europe, and the earthquake will have a negative impact on the transportation. From the perspective of black varieties, the impact of the earthquake on the supply and demand pattern of global crude steel and scrap steel is relatively limited.

Non-ferrous metals

Aluminum: Turkey’s own aluminum resources are not sufficient. There is only one electrolytic aluminum producer with an annual output of 70,000 tons (located in Konya, about 580 kilometers away from the earthquake center); in recent years, Turkey’s aluminum metal consumption has increased. From 1-1.1 million tons/year in 2020 to 1.5-1.6 million tons/year (accounting for about 5.5% of overseas aluminum consumption), the increase in consumption is mainly the export of aluminum coils, sheets and strips; Turkey’s aluminum raw materials is mainly relying on imports, and the net imports in the past two years have been around 1.3-1.4 million tons. Since most of Turkey’s aluminum processing is near Istanbul, the earthquake has little impact on it for the time being, and the specific impact remains to be further observed.

Copper: The scale of Turkey’s copper-related industries are generally low, and it is expected to have limited influence on the copper market. On the supply side, the annual output of domestic copper concencrate  is about 150,000 tons, but its crude refining capacity is only around 100,000 tons. Therefore, a little to no amount of copper concentrate is exported to Europe, and the rough refining output has all been used for local refining. The annual output of the refining is about 130,000 tons, and the part higher than the crude refining output needs to be supplemented by other secondary raw materials. In terms of consumption, Turkey’s annual copper consumption is about 480,000 tons, and it is more dependent on foreign imports.

Zinc: According to the annual data, Turkey’s zinc supply and demand share is relatively low: Turkey’s zinc concentrate production accounts for only 1.4%, and there are no large zinc smelters in the country. It is worth mentioning that Turkey imports about 260,000-310,000 tons of zinc ingots every year. We observe that there are no large-scale galvanizing plants in the country; therefore, we speculated that some of the imported zinc ingots are not consumed locally, and the rest are supplied to other European countries. The recent earthquake in the country may have little impact on its own zinc industry, but it is worth noting that, as a part of trade with Europe, the earthquake has a negative impact on its transportation and the funtionality of being the trade center.

Tin: Turkey’s tin industry accounts for a relatively low proportion in the world, and it is not an important transit point in tin trade, so it is expected to have very limited influence on the tin market.

Nickel: Turkey’s nickel ore reserves are relatively rich and of high quality, and mining is relatively easy, but it accounts for a small proportion of global nickel ore resources and mining volume. In 2022, China imports about 30,000 tons of nickel ore from Turkey, and the proportion of the quantity is negligible; At the same time, Turkey has its own intermediate product smelter, which comes from the Gordes project of Meta Nikel. The product is nickel cobalt hydroxide. The project was put into construction in 2014, with a total design capacity of 60,000 metal tons and an annual output of about 5,200 nickel metal tons in 2021. Accounting for 1.75% of the 300,000 tons of nickel intermediate products in the world, China will import 18,000 physical tons from Turkey in 2021, and China’s imports will increase to 20,500 physical tons in 2022.

Stainless steel: Turkey is mainly an import demand country. The annual demand for stainless steel is more than 700,000 metric tons, of which 75% depends on imports. In the past two years, the amount of stainless steel that China exports to Turkey have increased significantly, becoming its largest stainless steel supplier. In the first half of 2022, stainless steel exports to Turkey from China totaled 267,000 tons, an increase of 119,000 tons or 80.2% year-on-year. Among them, the export volume in the second quarter was at a high level. Turkey’s processed stainless steel products mainly radiate to European and American countries. Germany and the United States are the two largest exporters. Under the influence of the Eastern European incident last year, the widening price gap between China and other countries stimulated its demand for stainless steel export from China.

The earthquake may slightly interfere with the production of domestic metal smelting enterprises in Turkey. At the same time, the domestic post-earthquake repair and reconstruction demand may stimulate the increase of stainless steel imports from China, resulting in an increase in demand for nickel stainless steel metals and a decrease in supply. However, Turkey’s nickel and stainless steel production and consumption levels and the proportion is small, and the metal substitution elasticity in other countries is relatively large, which has little impact on the balance of nickel and stainless steel metals in China.

Ferrous metals

Turkey’s annual output of crude steel is 30-40 million tons, accounting for about 2% of the world’s total. The output of electric furnace steel is 20-30 million tons, which is about 5% of the world’s output of electric furnace steel; the output of converter steel is about 11 million tons, about 0.8% of the world’s output of converter steel. Turkey’s electric furnace steelmaking accounts for about 70% of the country’s crude steel production, and it is one of the countries in the world that mainly uses electric furnace steelmaking.

Turkey is a major importer of scrap steel in the world. In the past two years, the scrap steel import volume has exceeded 20 million tons. In 2021, the scrap steel import volume will account for nearly 25% of the world’s scrap steel import volume. Turkey’s EAF steelmaking is more than 80% dependent on imported scrap.

Turkey’s crude steel is mainly consumed domestically. In 2021, the apparent consumption of crude steel will be 35.58 million tons, accounting for about 1.8% of global crude steel consumption. The annual net export of crude steel will be around 5 million tons.

The post-earthquake reconstruction may lead to a decrease in its crude steel exports, but because the export volume is not large, the impact on the global crude steel supply and demand pattern is limited; the increase in the supply of depreciable steel scrap caused by the earthquake will play a role in the increase in the demand for scrap steel for post-disaster reconstruction. It has a certain buffering effect, so it is expected to have a limited impact on the supply and demand pattern of scrap steel.

Turkish Earthquake and Its Metal Industry2023-02-21T03:41:54+00:00


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