China’s upcoming megacity to create 400-kt aluminium demand

Chinese President Xi Jinping's dream project which aims at transforming a backwater called Xiongan, located 110km south of Beijing, into a technology and innovation hub, a city three times as big as New York, is set to create huge demand for aluminium building materials.

Jinping announced the state-level plan on April 1 this year. The city planned over a land area measuring 2,000 square kilometres will come up near the port city of Tianjin. Xiongan New Area is designed to relieve the pressure on Beijing from where state-owned companies and institutions including universities will be relocated to Xiongan.

According to a study by Wood Mackenzie, the investment in Xiongan totallig up to $580 billion over 20 years, according to some estimates, is going to create demand for residential, commercial and industrial buildings. These building and construction sector boom will in turn spur demand for aluminium building materials including aluminium extrusions, aluminium panels, windows and doors, claddings and aluminium cables and wires.

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Wood Mackenzie envisages the development of Xiongan adding around 400 kilo tonnes of aluminium demand in addition to other ferrous and base metals. The project work is estimated to peak between 2020 and 2025.

Shenzen, a similar project is a mammoth success in China. If Xiongan succeeds in rivalling Shenzen in terms of demand for resources, the additional demand will increase to 30 Mt of steel demand, 660 kt of aluminium, and 400 kt of copper over the next 10 years.