Date: 21 November 2012

Length: 1:52

Founded in 1898, Salzburger Aluminium AG is the third-oldest producer of refined aluminium in the world.

Nestled in the Austrian Alps, it remains headquartered in Lend, about one-hour’s drive from Salzburg, but now has locations in countries including France, the Netherlands, Mexico and Oman.

The company closed its only smelter in 1992 following a management buyout, but continues to operate casthouses and its portfolio includes a wide variety of products across its subsidiaries.

It has been run by the Woehrer family since the buyout, but has a broad international scope, with an export ratio of 90%.

Its turnover in 2011 was 277 million euros.

However, demand for its proprietary “thixotropic” alloys in particular is declining, and production is expensive, leading to a cutback in output in recent years.

SAG’s focus remains on specialist products, according to Andreas Kraly, md of subsidiary Aluminium Lend, but it is beginning to feel the effects of growing competition from China and East Asia.

Production there, as most market participants will attest, is both cheap and prolific, and its effect is becoming increasingly difficult to avoid.

Instead of shifting focus to Asia, therefore, SAG has begun the process of expanding into Brazil, where recycling rates are high and demand for material is growing.

It is also working to create a “closed loop” for production – a subject surrounded by some controversy among scrap dealers and merchants – so that it can produce new material from its own scrap.

It remains a relatively small player, however, with a modest market share, and will continue to prioritise its Brazilian expansion, followed by Russia, and then Turkey – and finally Asia, if and when the time is right.

Claire Hack
Twitter: @clairehack_mb