Novelis Inc. have announced that in early 2023 it signed a new anchor customer contract with aluminum can maker Ball Corporation in North America. Under the contract, Novelis will supply aluminum sheet to Ball can making plants in North America.
With this contract and other commitments, Novelis has secured all of the beverage can capacity from its new plant in Bay Minette, Ala., underscoring the strong demand for the company's high-recycled-content beverage can sheet. The new plant, expected to begin commissioning in 2025, will be the first fully integrated aluminum manufacturing plant built in the U.S. in nearly 40 years and will have an initial capacity of 600,000 tonnes of finished goods primarily for the North American beverage can and automotive markets.
"Securing contracts for beverage can production capacity at Bay Minette two years before the plant is expected to be completed demonstrates our customers' confidence in our ability to plan, construct and operate our new plant in Alabama," said Steve Fisher, president and CEO of Novelis. "We're proud to continue our partnership with Ball in such a meaningful way and look forward to bringing our new plant online in the next couple of years."
The agreement between Novelis and Ball advances both companies' sustainability commitments by including closed-loop recycling and joint efforts to improve beverage can recycling. Through closed-loop recycling programs, Novelis directly takes back the manufacturing scrap generated during the can-making process and recycles it into new can sheet, which is then made into new beverage cans. In addition to this continuous loop, Novelis recycles more than 82 billion used beverage cans per year into new aluminum for beverage packaging. These efforts result in lower-carbon products, as recycling aluminum requires only 5% of the energy used to make primary aluminum, resulting in 95% less carbon emissions.
"Novelis is a critical partner in helping Ball reach our carbon footprint reduction goals and achieving full circularity for aluminum beverage packaging," said Ron Lewis, senior vice president & chief operating officer, global beverage packaging, Ball Corporation. "Our longstanding relationship with Novelis continues to generate significant benefits for our companies, our customers, and the long-term health of our planet."
The new contract is an extension of a multi-decade partnership between Novelis and Ball, stemming from a mutual focus on sustainability and innovation. For example, as of 2022, Ball Aluminum Cup®, which is made exclusively from Novelis-supplied aluminum, is now composed of 90% recycled content, the highest recycled content rate of any beverage packaging in its category. This evolution builds on the Ball Aluminum Cup's infinite recyclability by lowering its carbon footprint, further positioning the product as a sustainable solution for packaging waste challenges.
"Novelis and Ball are like-minded companies committed to creating a truly circular economy for aluminum beverage packaging," said Greg Schlicht, senior vice president, global beverage packaging, Novelis. "Our long-term collaboration has brought innovative products to market and set a new standard for sustainability. We are excited to continue this partnership and to meet growing demand for environmentally friendly beverage packaging."
Novelis expects global demand for aluminum beverage can sheet to grow at a 3% compounded annual growth rate from 2022 to 2031. The demand growth is driven by consumer preference for more sustainable products and size variety, as well as more beverage types being packaged in cans, including water, energy drinks, soda, beer, wine, hard seltzers and ready-to-drink cocktails.