The use of aluminium in today’s global economy is ubiquitous by nature, touching nearly every area of commerce from packaging to transportation in the delivery of its unique benefits.
The metal is treasured for its strength-to-weight ratio, for its density and for its ability to resist corrosion. It is also the most abundant metal in the Earth’s crust and the third most abundant element on the planet, following oxygen and silicon.
With such widespread utility, it is no wonder that the aluminium industry has suffered mightily during the global recession that began in 2008. However, there are positive signs that point to a rebound for the industry in 2010 and beyond.
Aluminium is used extensively in the modern world. Its uses are diverse due to its many beneficial properties. No other metallic element has been incorporated in so many ways over such a variety of fields.
Uses are found in the home, in all forms of transportation, and in industry and commerce. More commonly known for its consumer uses, aluminium and its oxides support many manufacturing processes and finished products from glass to electrical components.
Since the metal is not found in nature as a free metal due to its chemical reactivity, it is found combined in more than 270 different minerals, with the primary source for mining companies being bauxite ore.
The global production for aluminium is concentrated across the globe in six countries. With approximately 40Mt/y produced, the leading six countries account for nearly 70% of global production as follows:
United States 7%
China has been the leader in production and growth year-over-year, a necessity when fueling a manufacturing and export economy growing at double-digit rates.
The United States has maintained healthy growth rates, too, while the other countries have been nearly flat. The global downturn, however, affected all producers as demand for the metal, driven primarily by the automotive and aviation industries, plummeted in 2008 and 2009.
The impacts have been global in nature, but the following headlines seem to suggest that a modest recovery is underway:
Headline: National Aluminium Company (Nalco), India's second-largest producer of the metal, said profit more than doubled in the first quarter as an economic recovery led a surge in demand and prices.
Headline: Australian miner Alumina Limited saw profits soar in the first half of the year thanks to higher sales and prices.
Headline: Novelis reported record quarterly financial results for the first quarter of fiscal 2011 as a result of strong demand. This is the second consecutive quarter since the economic downturn that shipments grew in all regions year-on-year.
Headline: Rio Tinto's profits for the January to June period have reached a record first-half high for the firm, fueled by Chinese demand for its iron ore. Meanwhile, its aluminium arm returned to profit, with earnings of $313M, as overall metal demand and prices continued to rise as the global economy improved.
Headline: US aluminium-maker Alcoa has reported a return to profit as sales surged in the three months to the end of June. The Pittsburgh manufacturing giant also forecast a small increase in global aluminium demand this year.
From other industry quarters, German aluminium foundries are also benefiting from strong orders from luxury-car makers and expect to post significant growth in 2010.
As the Euro weakened in Forex markets, confidence has grown among German exporters. The resurgence of the automobile industry in the United States and in developing countries, such as China and India, is the driver behind much of this increased global demand for aluminium. Industry experts also expect production to reach pre-crisis levels during 2010 and grow beyond from there.
Demand will not only come from the car industry. Aluminium is still the product of choice for airliner fuselages, although carbon and glass fibre-reinforced plastics are making inroads in this sector.
Shipbuilding, rolling stock construction, and manufacturers of transportation equipment and containers will also continue to depend on the benefits of the metal.
The renewables energy sector is also a new source for demand as solar energy arrays consist of many aluminium-dependent components, while wind energy relies on aluminium for propellers and small turbines.
Aluminium will always be viewed as the material of the future. However, there are major areas where improvement is necessary.
Compared to other industries, aluminium producers use over three times as much energy to extract their byproduct. Energy, operating and environmental efficiencies are high priorities, along with needed advances in the areas of scrap separation and manufacturing processes.
All of these issues have been defined and are being addressed with increased R&D expenditures, leading most industry pundits to agree that aluminium is on a growth course even in these times of economic difficulty.