Innovative technologies & sustainable solutions key to meet growing aluminium demand.
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As the global economy rebounds from the COVID-19 recession, the demand for aluminium is set to surge, with the International Aluminium Institute projecting a 40 per cent rise by 2030, requiring an additional 33 million tonnes of annual production. Karl Ágúst Matthíasson, co-founder and CEO of Icelandic aluminium analysis firm DTE, has shared his outlook for the aluminium industry in the coming year.
As an engineer and entrepreneur focused on revolutionising aluminium production, Karl anticipates increasing demand amid mounting energy and cost challenges. To meet these growing needs, he also foresees the integration of new technologies and increased usage of low-carbon aluminium products into the production process.
European aluminium producers to scale back production
As per his predictions, in recent years, high energy prices have forced European aluminium producers to scale back production, a challenge worsened by energy supply disruptions following Russia's invasion of Ukraine. According to the International Aluminium Institute, European aluminium production fell by 3.95 per cent in 2023, dropping to 6.73 million tonnes.
Aluminium production is highly energy-intensive, requiring the molten metal to be maintained at around 700℃ for extended periods. With no significant relief in energy costs expected in the near future, disruptions to Europe's domestic aluminium production are likely to persist.
To counter the decline in domestic aluminium production, Europe may look to increase imports from major suppliers like China. However, the risk of further disruptions to European supply chains remains significant, with key global trade routes passing through several potential hotspots, such as the Red Sea and South China Sea. This could lead to longer shipping times and higher freight costs, posing ongoing challenges to securing a steady aluminium supply.
Aluminium scrap usage on the grow
Several factors are converging to drive up demand for scrap aluminium. As the need for aluminium increases, the supply of primary aluminium is becoming tighter, while high energy prices make its production more costly. Additionally, government emissions targets and consumer demands are pushing producers to find ways to decarbonise. In response to these challenges, the aluminium industry is expected to increasingly turn to secondary (scrap) metal, which requires 95 per cent less energy than primary production.
With aluminium already being recycled at a rate of approximately 76 per cent, according to the International Aluminium Institute, buyers in Europe and North America will likely face stiffer competition from Asian markets for available scrap supplies. Producers can address this by enhancing recovery techniques to ensure that as much aluminium as possible is recycled and reintroduced into the supply chain.
Demand for low-carbon aluminium
The Aluminium Stewardship Initiative has outlined that the aluminium industry must cut its emissions by over 95 per cent by 2050 to meet the 1.5℃ climate target. Achieving this ambitious goal will require low-carbon aluminium to become the industry standard. Emissions targets are already a top priority for producers, and many are working on strategies to increase the production of low-carbon aluminium, whether through recycling or by using energy from low-carbon sources. Major producers, such as Emirates Global Aluminium, are actively focusing on meeting the rising global demand for low-carbon aluminium and are expected to continue doing so in the foreseeable future.
With high energy prices and growing demand for sustainable aluminium, producers will increasingly adopt energy-saving technologies. Innovations like real-time composition analysis offer significant energy savings by reducing the time aluminium remains molten and minimising the need for energy-intensive remelting processes. These advancements will help producers cut energy consumption and meet their emissions goals.
As an engineer and entrepreneur focused on revolutionising aluminium production, Karl anticipates increasing demand amid mounting energy and cost challenges. To meet these growing needs, he also foresees the integration of new technologies and increased usage of low-carbon aluminium products into the production process.
European aluminium producers to scale back production
As per his predictions, in recent years, high energy prices have forced European aluminium producers to scale back production, a challenge worsened by energy supply disruptions following Russia's invasion of Ukraine. According to the International Aluminium Institute, European aluminium production fell by 3.95 per cent in 2023, dropping to 6.73 million tonnes.
Aluminium production is highly energy-intensive, requiring the molten metal to be maintained at around 700℃ for extended periods. With no significant relief in energy costs expected in the near future, disruptions to Europe's domestic aluminium production are likely to persist.
To counter the decline in domestic aluminium production, Europe may look to increase imports from major suppliers like China. However, the risk of further disruptions to European supply chains remains significant, with key global trade routes passing through several potential hotspots, such as the Red Sea and South China Sea. This could lead to longer shipping times and higher freight costs, posing ongoing challenges to securing a steady aluminium supply.
Aluminium scrap usage on the grow
Several factors are converging to drive up demand for scrap aluminium. As the need for aluminium increases, the supply of primary aluminium is becoming tighter, while high energy prices make its production more costly. Additionally, government emissions targets and consumer demands are pushing producers to find ways to decarbonise. In response to these challenges, the aluminium industry is expected to increasingly turn to secondary (scrap) metal, which requires 95 per cent less energy than primary production.
With aluminium already being recycled at a rate of approximately 76 per cent, according to the International Aluminium Institute, buyers in Europe and North America will likely face stiffer competition from Asian markets for available scrap supplies. Producers can address this by enhancing recovery techniques to ensure that as much aluminium as possible is recycled and reintroduced into the supply chain.
Demand for low-carbon aluminium
The Aluminium Stewardship Initiative has outlined that the aluminium industry must cut its emissions by over 95 per cent by 2050 to meet the 1.5℃ climate target. Achieving this ambitious goal will require low-carbon aluminium to become the industry standard. Emissions targets are already a top priority for producers, and many are working on strategies to increase the production of low-carbon aluminium, whether through recycling or by using energy from low-carbon sources. Major producers, such as Emirates Global Aluminium, are actively focusing on meeting the rising global demand for low-carbon aluminium and are expected to continue doing so in the foreseeable future.
With high energy prices and growing demand for sustainable aluminium, producers will increasingly adopt energy-saving technologies. Innovations like real-time composition analysis offer significant energy savings by reducing the time aluminium remains molten and minimising the need for energy-intensive remelting processes. These advancements will help producers cut energy consumption and meet their emissions goals.