Global aluminium industry has gone through a lot of structural and technological changes in the last couple of decades and Europe is one of the region’s leading the innovation and demand. In European Union, aluminium has traditionally been considered as a strategic sector, with major focus on downstream. With annual revenue ~40 billion euros and with 250k+ employees, it is the second biggest industry in metals and mining, after steel. Most European companies now work in the downstream phases of the value chain of the production of aluminium semis for the automotive, transportation, aerospace, building and construction, durable products and packaging industries, while the number of companies operating in the upstream phases of alumina refining and primary production of raw aluminium progressively diminished over time.
While the amount of recycled content in the average aluminum can far exceeds competitive packaging types, there is room for significant improvement in the aluminum can recycling rate. The aluminum industry’s ultimate goal is to recycle every can that’s produced.
SUPPLY – DEMAND SCENARIO
In 2019, primary aluminium production in Europe remained flat after a slightly negative year in 2018. This flat production continued its pressure on supply chain of aluminium by global trade issues and high energy prices in Europe. EU28 countries still import approximately 50% of its aluminium product requirements. As a part of European economic area, Norway and Iceland are the largest exporters of primary aluminium of EU.
In 2019, the EU exported around 1.1 million tonnes of aluminium scrap. About 80% of this is exported to Asia. European aluminium statistics showed mixed demand of semi-fabricated products. After several years of robust growth, in 2019, European demand or flat rolled products (FRP) was marginally positive. FRP demand growth was driven by packaging and transport, which represents more than 60% of the FRP demand.
VALUE CHAIN ANALYSIS
- Bauxite Mining: Greece is the only EU country with a significant bauxite production (1.8 million tons in 2017). It is estimated that roughly 0,7% of the world’s bauxite was produced in the EU in 2016. The largest producing countries globally are Australia (with a share of the global output equal to 28% in 2017), China (23%), Guinea (15%), Brazil (12%) and India (9%).
- Alumina Refining: The EU imports the best part of alumina required for the internal production of raw aluminium. It should be considered that the main producing countries in the EU (Ireland, Germany, Spain and Greece) represented about 4.6% of the global production of alumina in 2017. Alumina refining production capacity is also present in France and Romania.
- Primary and secondary production of raw aluminium: The market share of European countries in the production of primary aluminium went from 30% in 2000 to roughly 12% in 2017, with overall production values of 7.8 million tons in 2017. Only 2.1 million tons have been produced in the EU, or about 3.4% of the global production. About 60% of this production may be referred to just three countries, Germany, France and Spain.
- Semi-finished products: Raw primary and secondary metal is used, mostly as aluminium ingots or bars, slabs and billets, by downstream companies to produce semis meant for the needs of such important final use sectors as automotive, transportation, building and constructions, mechanics, furniture etc. Focusing on extrusions, rolled products and foundry castings, the global production of aluminium semis added up to over 77 million tons in 2017, with an increase of 33% in the 2012- 2017 period.
- Extrusions: In the 2000-2017 period, extrusion productions in EU28 remained relatively stable, settling down at about 2.8 million tons in 2017, with an average decrease to 0.1% with respect to 2000. As a consequence, the share of the EU on the world’s production of aluminium extrusions drastically decreased, going from almost one third in the 2000-2003 period to 9% in 2017.
- Rolled Products: In the 2000-2017 period, the production of rolled products in EU28 increased by 19%, reaching about 4.5 million tons in 2017. This is a production level just above that recorded before the economic crisis. In spite of the increase in the total production, the share of EU28 countries in the global production of rolled products rapidly decreased (from 29% in 2000 to 17% in 2017). In 2017, about 68 percent of rolled products in the EU have been produced in just three countries (France, Germany and Italy).
Europe is anticipated to be the second principal market. The region’s aluminium market trends are estimated to see steady evolution throughout the forecast period 2020-2027. Major companies contributing in Europe are:
- Alcoa: Producer and manufacturer of primary aluminium, fabricated aluminium and alumina facilities.
- Alcomet: Specialized in the production of aluminium rolled and extruded products.
- Alprofil AG: Swiss company that manufacture aluminium profile frames and frameworks.
- Hydro: An offshore producer of oil, gas and supplier of aluminium.
- Le Belier: Produces aluminium safely related components for automotive industry.
- Luxfer Group: Specialising in the production of magnesium, aluminium and zirconium.
- JVM: An aluminium pressure die casting company in the UK.
- Hurtz GmbH & Co. Kg: An aluminium specialist for frames and pallets, company located in Germany.
- Profilco: A modern aluminium profile equipment manufacturer in Europe.