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  • Outlook 2017: How end- user will drive aluminium market in 2017

  • DETAIL

    The automotive, aerospace, construction, electrical and packaging sectors emerged as the largest aluminium end users in 2016. These sectors will continue to drive aluminium consumption in the foreseeable future as well as in 2017. Let’s explore:

    Automotive

    The year 2017 projects aluminium consumption for automotive body and chassis structure will increase significantly. Aluminium in automotive industry is expected to reach at a CAGR of 7.4% from 2015 to 2020; showing steady growth of aluminium demand in 2017.The North America and Europe will use maximum aluminium in their automobiles after the enactment of Corporate Average Fuel Economy (CAFE) standards.

    South Coast British Columbia Transportation Authority (TransLink) signed a $C 93m ($US 69.5m) contract with Bombardier for 28 Mark III light metro cars for Vancouver’s SkyTrain- an automated light metro network with aluminium body. The first few aluminium trains are expected to enter service by early 2019.

    By the end of the decade, Novelis forecasts aluminium consumption in automotive market will reach by 30 per cent each year.

    News
    Ducker Worldwide forecasts aluminium will comprise more than 75% of pickup-truck body parts, 24% of large sedans, 22% of SUVs and 18% of minivan body and closure parts by 2025.

    Aerospace

    ALFED, the trade association which represents the British aluminium industry, said the company records tremendous order of aluminium supplies to the Airbus and Boeing manufacturers and it is forecasted that the aluminium demand from this sector to grow more in future.

    The Airbus 380 uses 10 times the aluminium that the Airbus 320 did, representing one of the world’s largest passenger aircraft.

    NewsWill Savage, ALFED’s CEO said. “Without the lightweight, structurally sound aircraft that aluminium has permitted, many of the long-haul as well as short-haul flights we take for granted today simply wouldn’t be possible”.

    Construction

    The construction sector is the second most growing sector after transportation in terms of aluminium usage. Smart city project in India is expected to boost the aluminium demand significantly in the recent year. Bangladesh construction sector has started using aluminium in small scales just before the beginning of the new millennium. Reynaers Aluminium Romania reported that 20% of newly homes in Romania are using premium aluminium joinery.

    The Greater Hyderabad Municipal Corporation announced its plan to popularise the Energy Conservation Building Code, resulting use of aluminium profiles, panels and other extrusion products for construction.

    According to Building & Construction Market Research report, the energy-efficient windows market size is expected to reach grow from USD 10.12 Billion in 2016 to USD 25.31 Billion by 2026, at a CAGR of 8.6% from 2016 to 2026.  The report focussed on different sections such as glazing type, application, component, end-use sector, and region.
    NewsUS Demand for green building materials is forecasted to reach $86.6 Billion in 2017. All put together construction sector is going to drive demands of aluminium extrusions and profiles to a large extent.

    Electrical

    According to Research and Markets report, the global aluminium conductors market is estimated to grow at a compound annual growth rate (CAGR) of 2.63 per cent during the five year forecast period 2017-2021.

    The total market size of aluminium conductors comprising aluminium conductor steel reinforced (ACSR), all aluminium alloy conductors (AAAC), and all aluminium conductors (AAC), is expected to witness growth in the review period.

    The key vendors in the global aluminium conductor market identified in the report include General Cable, Nexans, Prysmian, Southwire, Sterlite Technologies, Apar Industries, Far East Cable, Henan Huatai Special Cable, and Henan Tong-Da Cable. Driven by strong demand in the Middle East and South East Asian countries these companies are expected to increase their market share manifold in 2017.

    Packaging

    Aluminium is used in the packaging industry due to its ability to store the food for long periods and preventing food from germs and bacteria. According to Technavio’s report, the global aluminium foil packaging market will grow at a CAGR of 3.69 per cent by volume during the period 2016-2020.

    News
    As per market research report by Grand View Research Inc., the global beverage cans market is estimated to grow USD 60.92 billion by 2024. Due to the growing recognition of the aluminium can as one of the most recycled aluminium products in the world and as one of the most sustainable packaging solution, the use of aluminium cans is growing around the world, especially in developed countries. Increase in aluminium can consumption will drive demand for aluminium can sheet all over the world.

    Others

    FIFA have revealed its new trophy for the world’s Best Player award. The new trophy is crafted out aluminium, brass and carbon. The world’s best player award is a part of the inaugural best FIFA football awards. The new trophy is comprised of a number of parts such as the bottom, a carbon base, the body and a ball placed on top.

    FIFA said a great amount of effort has been put into making this new trophy. The new trophy’s ball on top represents the football used in the first ever World Cup played in Uruguay in 1930.

    Positive demand outlook for end users has helped aluminium product manufacturers finalize their investment, production and sales strategy for 2017. Aluminium has started the year with a positive note with LME aluminium prices hitting new highs.  If China overcapacity issues are handled properly, end user demand  will continue giving strong support to aluminium prices.


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