ALUMINIUM CONF: Primary Al capacity needs to grow by 4.5 million tpy

Primary aluminium smelting capacity has to grow by about 4.5 million tpy to keep pace with global demand, Joe Petrolito, Hatch’s director of light metals in North America, told delegates at Metal Bulletin’s 30th international aluminium conference in Vancouver.

Primary aluminium smelting capacity has to grow by about 4.5 million tpy to keep pace with global demand, Joe Petrolito, Hatch’s director of light metals in North America, told delegates at Metal Bulletin’s 30th International Aluminium Conference in Vancouver.

Demand growth will come mainly from China, where the 7% per year growth rate of recent years will fall to about 4% in the next few years, Petrolito said.

“We’ve seen markets change dramatically over the last few years, but overall consumption is increasing,” he added. “New requirements will need about 4.5 million tpy in capacity additions.”

While China will continue to play a huge role in global aluminium supply, Petrolito see opportunities further ahead for regions such as Africa, Eastern Russia, South-East Asia, and Greenland.

“In Europe and the US you have high labour costs and little government help,” he said, adding that China and the Middle East also have high opportunity costs.

“The landscape is changing on an almost daily basis,” he said. “At today’s prices, 20% of smelting capacity is underwater.”

In older markets, Petrolito sees both greenfield and brownfield sites having role to play, while debottlenecking and improving cost efficiencies will also boost production levels at existing facilities.

“The market’s fundamentals are very strong, and long-term capacity requirements much be filled,” he said.

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