AL Circle Analysis: Bauxite developments, alumina trade & primary aluminium market dynamics across Australia, Guinea, US & India
The aluminium industry is entering another phase of supply-chain repositioning. Across bauxite, alumina and primary aluminium, companies are investing in new resources, consolidating strategic assets and expanding processing capacity, while governments are increasingly treating domestic supply as a strategic priority. The latest developments from Australia, Guyana, Guinea, Indonesia, the US and India point to a market where resource security, processing location and control over supply chains are becoming as important as production growth. At the same time, new trading mechanisms and changing investment patterns are beginning to influence how aluminium and its raw materials reach the market. Bauxite supply expands, but securing the right tonnes is becoming harder In Western Australia, VBX...
China's 22.87 Mt extrusion market faces a structural shift as 317 GW solar growth counters weak construction demand
The global aluminium extrusion landscape is undergoing a structural transition driven by industrial decarbonisation, global electrification, and the rapid deployment of clean energy infrastructure. Historically anchored by civil engineering and residential real estate, demand for extruded aluminium profiles in China, the world’s dominant manufacturing hub, is decoupling from traditional property sectors. Persistent structural weakness in China’s domestic construction market has slowed the consumption of conventional architectural profiles such as window frames, door sections, and curtain walls. Conversely, advanced industrial applications, specifically solar photovoltaic (PV) racking, battery energy storage systems (BESS), power grid modernisation, and electric vehicles (EVs), have...
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Bauxite mining to help boost Malaysia's Tanah Makmur earnings
Bauxite mining is expected to help sustain Malaysia's Kuantan-based Tanah Makmur’s earnings in spite of lower net profit from its other business in the near term. Some 1.2 million tonnes of bauxite were discovered on Tanah Makmur’s KotaSAS township land banklast year, The company started mining the aluminium ore mid-year. Kenanga Research expects current mining operations to contribute RM65mil to RM92mil to financial year 2015 and 2016 (FY15 to FY16) revenue estimates. “Furthermore, management has mentioned that preliminary studies indicate that there is another approximately 800,000 tonnes of bauxite reserves, which we estimate could contribute about RM140mil additional revenue in FY16-FY17 estimates, if confirmed,” it said. Net profit, however, would take a gradual beating due to lower...
Bonnell Aluminum announces price increase for 2016
Bonnell Aluminum, including its wholly-owned subsidiary AACOA, Inc., announced that it is implementing a price increase of $0.035 per pound on base conversion, 6% on anodizing, 10% on paint, and 3% on fabrication services, effective with shipments on and after January 11, 2016. “Due to the tight market for skilled labor in the areas where our plants are located, the costs associated with recruiting, training, and retaining skilled workers have continued to rise above what we are able absorb,” said Ira Endres, Vice President Sales and Marketing. “This price increase is necessary to offset the impact of these rising costs, and it allows for critical investments in our business to ensure that we have the quality, service, capacity, and capability to meet our customers’ demand.” The price...
PepsiCo surpasses 2014 recycling goals, uses more rPET
PepsiCo has reported that it diverted 93 percent of its waste from landfills in 2014, surpassing its recycling goal and reusing 90 percent of its waste. The company also says it decreased the overall amount of packaging by 89 million pounds in 2014 versus the prior year and used 134 million pounds of food-grade recycled polyethylene terephthalate (rPET) packages and bottles, an increase of 23 percent from 2013. The findings are included in the company's recently released 2014 Corporate Sustainability Report. PepsiCo also released a Global Reporting Initiative (GRI) Report and its first-ever sustainability microsite, howwillwe.com. The consumer products company says its environmental sustainability programs saved it more than $375 million since its goals were established in 2010. PepsiCo...
Garmco revamps international operations
Bahrain-based Garmco, an international aluminium rolling mill and one of the largest downstream aluminium facilities in the Middle East, has completed a major restructuring of its international operations. This is in line with the company's three-year strategy, which involves closing unprofitable subsidiaries and non-operating companies; and identifying additional opportunities for growth in high-margin markets where Garmco has established a strong presence, in particular South East Asia, the US and Australia, said a statement from the company. The restructuring has resulted in the closing of unprofitable subsidiaries in the saturated markets of China and Korea, and non-operating companies in Hungary and Cyprus, which do not add value to the company’s core activities, it added. Garmco US...
Chinese aluminum scrap prices declined
The Chinese Aluminum scrap prices declined marginally on the Scrap Monster Price Index on October 13th, Tuesday. 6063 Extrusions witnessed a price decline of CNY 100 per MT over the previous day. Aluminum Ingots and Transformers prices declined by CNY 100 per MT each. E.C Aluminum Wire prices dropped by CN 100 per MT to touch CNY 11,400 per MT. Old Cast prices too witnessed a down move of CNY 100 per MT. The prices of Aluminum Radiators and Old Sheets saw a down move of CNY 100 per MT. UBC and Zorba 90% INF prices declined by CNY 50 per MT each from the previous day levels.
Use of RVM will increase percentage of recycled aluminium packaging in India, says Can-Pack MD
In the recently ended World Packaging Congress in Mumbai, Marek Kura, managing director of Can-Pack, said the use of RVM i.e. Reverse Vending Machine, currently used by many countries for recycling of metal cans, is yet to take off in India. Can-Pack India is the country’s leading aluminium beverage can-manufacturing company with almost 70% of market share. Talking about the aluminium beverage can recycling scenario in India at the global event that took place in Mumbai, during October 9-10, Mr. Kura said, RVM helps by giving incentives in exchange for recyclables. The attractive advantages of RVM are: customised graphics, varied capacities, special software and online monitoring, built-in wall and multimedia versions. This initiative gives advanced, modern solution which can affect...
Instacom catches investors’ eye after Neata acquisition
Instacom Group Bhd saw high volumes of trade the past two days following the acquisition of an additional 43.6 per cent stake in Neata Aluminium (Malaysia) Sdn Bhd (Neata) which raised the group’s stake in Neata to 78.6 per cent from 35 per cent. Instacom was the third most active counter on Bursa Malaysia on Monday with more than 50 million shares traded, rising to a high of 23 sen and closing at 21.5 sen on Monday, October 12. According to Instacom executive director Choo Seng Choon, Instacom is confident that the acquisition will be beneficial to the group given the strong track record of Neata-Vivocom with its current order book or RM247 million – with visibility up to March 2018. “This means that, the Instacom Group will have strategically diversified into new areas and viable...
Shandong Weiqiao to procure ACHENBACH OPTIMILL® - rolling mills for 32 t coils in China
Shandong Weiqiao Pioneering Group (China) is building an aluminum flat rolling plant in Weihai with a large 2,300 mm-wide rolling mill and 1,850 mm-wide thin strip rolling mill. The rolling mills, both of which are brought on line, will represent together the core of most modern production for litho sheets. This is in line with Shandong Weiqiao's strategic decision that it took a few years ago; it was decided then that the company would advance its presence in the aluminum industry by investing in a new state-of-the-art aluminum flat rolling plant. Shandong Weiqiao management now feels vindicated in choosing the right suppliers with Achenbach, constituting an ideal combination of state-of-the-art technology and extensive experience.
Alcoa’s alumina segment generates best profitability since 2007
Alcoa is the largest global bauxite and alumina producer, with a strong first quartile cost position in both businesses. Alcoa reports the earnings of its bauxite mining and alumina refining business under its Alumina segment. The segment supplies alumina to Alcoa’s Primary Metals segment as well as sells to third-party customers. Together, Alcoa and Ball Corporation (BLL) form ~4.4% of the Materials Select Sector SPDR ETF (XLB). Record earnings: • The Alumina segment’s third-party shipments in 3Q15 stood at 2,798 thousand tons, which represents a 3.1% year-over-year (or YoY) increase. • Alcoa has been gradually moving away from aluminium-based pricing. Now it prices ~75% of its alumina based on the API (alumina price index) or spot pricing. This makes the Alumina segment’s fundamentals...
UC Rusal to produce alumina from Siberian clay
UC RUSAL, a leading global aluminium producer, develops acid technology for alumina production of non-bauxite raw materials. The technology will allow the production of alumina using domestic kaolin clay as a substitution to imported bauxites. The new technology will significantly boost RUSAL smelters’ economic efficiency thanks to the low cost of the material and the logistical cost reduction. The technology also allows for the simultaneous production of a number of high demand products, including those with silicon oxide and rare-earth metals bases. Acid technology implementation will create an entire complex of related production and research facilities, having stimulated Russia’s industrial and scientific potential by using modern technologies. The project is being executed within the...
Faurecia inks JV with Beijing WKW Automotive Parts
Faurecia and Beijing WKW Automotive Parts have signed a 50/50 joint-venture agreement to create an entity named Beijing WKW-FAD Automotive Interior Parts. Beijing WKW Automotive Parts is a major supplier of vehicle interior aluminium decoration in China. Faurecia, which claims to be the world market leader for aluminium decoration, will gain an industrial footprint in China to serve its customers, starting with Infiniti and Volvo. Together, the partners claim, they will lead the Chinese market and achieve synergies. With total planned investment of EUR14m (US$15.9m), BWKWFAD will specialise in interior aluminium decoration parts for the Asian market, covering development, manufacturing, assembly and marketing. The company will also provide after sales services and technical consulting....
Jaguar's all new SUV E-Pace to follow F-Pace launch
The Jaguar F-Pace that is awaiting launch will be followed by a smaller SUV built on a different platform. The machine is called the E-Pace. It is part of Jaguar's plan to play catch-up on the global crossover craze and follows shortly after the already-testing F-Pace, originally, the C-X17 concept car. The F-Pace will be an expensive SUV and will go up against the BMW X3 and Mercedes GLC. The projections suggest that Jaguar's second crossover model should generate enough volume to make a serious impact on the bottom line. Especially as the engineering profile would put it on equal footing with the Range Rover Evoque, helping curb development and production costs. The F-pace employs the British carmaker's aluminium intensive XE platform and would have proved to be too expensive for the...
Sustainability on display at Sapa’s aluminium building systems office
Sapa President & CEO Egil Hogna took his first close look at the company’s aluminium building systems organization in Ulm and its zero-energy test center in Bellenberg. At both German sites, the message was clear: Sustainable solutions come first. After joining Sapa as its chief executive on September 1, Hogna (pictured) said he wished to spend much of his first 100 days visiting company locations and meeting with employees around the world. His visit to Ulm and nearby Bellenberg on October 8 was part of the plan. After spending the morning at Sapa’s multi-brand building systems office in Ulm, Hogna and executive vice president Karsten Lundgaard, who leads Sapa Building Systems, moved on to Bellenberg to visit the systems-dedicated extrusion plant and the Wicona-brand test center. At the...
LME aluminium may fall to $1,562
LME aluminium may fall to $1,562 per tonne, as it has broken a support at $1,597. The support was provided by the 38.2 percent Fibonacci retracement on the fall from the July 2 high of $1,744.50 to the Aug. 24 low of $1,506. The next support will be at $1,562, the 23.6 percent level, a break below which could cause a loss to the 14.6 percent level at $1,541. A bounce from the current level could most likely be limited to $1,597, now a resistance.
Qatalum attends ALUEXPO 2015
Qatalum has taken part in ALUEXPO 2015, connecting with leaders in the aluminium sector from all over the world over the course of the three-day fair. Billed as 'Eurasia's Leading Event for the Aluminium Industry', ALUEXPO 2015 was held from 8-10 October in Istanbul, Turkey. The event's exhibitors included more than 350 major aluminium industry players from Europe, Asia, the Middle East, and the Americas. Based at a stand at the Istanbul Expo Center, a senior management delegation from Qatalum networked with fellow participants and guests, shared knowledge, and disseminated information about the latest developments at the company. At the conclusion of the Fair, Mr Khalid Laram, CEO of Qatalum, said: "This year's ALUEXPO was a first-rate platform to connect with leaders and influencers...
Noble sells off aluminum stockpiles to shrink its metal franchise
Noble Group Ltd, in its effort to free up capital by reducing stockpiles of base metals, has been reported to be selling off some of its large holdings of aluminum, historically one of its biggest businesses. As part of a strategy to shrink its metals franchise, the second-biggest division by revenue after energy, Noble has been quietly selling base metals since July, said an industry source. Still, company officials have privately portrayed them as a shift away from non-core, capital-intensive areas as the company focuses on its legacy strengths, which include alumina and aluminum trading. Yet the inventory reduction has also occurred in aluminum, said the source, suggesting that the metals division shake-up may be deeper than widely known. In August, Noble blamed the second-quarter loss...
China's aluminum glut set to continue
Amid concerns over China's export push, aluminum prices hit a 6-year low of $1,506 per ton on the London Metal Exchange in late August. The commodity will likely have no choice but to remain top-heavy, unless global output declines in aluminum producing nations other than China. Mixed signals Speculations regarding consolidation moves among major aluminum smelters are now doing the rounds in China, due to the country's excessive production of aluminum. Industry sources now say a merger between state-owned enterprises -- Aluminum Corp. of China and State Power Investment -- is most likely to happen. The Chinese government has begun moving to reform state-owned enterprises, promoting mergers and acquisitions among them. The industry's realignment will help control the country's production...
UC Rusal approves first dividend payout
Shares in United Company Rusal, the world’s biggest aluminium producer last year, rose in Hong Kong on Tuesday, October 13, after approving its first-ever dividend payment, even as commodity producers grapple with a rout in prices. The company, controlled by Russian billionaire and president Oleg Deripaska, planned to pay an interim dividend of $0.016 a share in November, it said in a statement. Rusal has not made a payout to shareholders since going public in Hong Kong in 2010. Rusal rose as much as 2.1% to HK$3.42 in Hong Kong, trimming its decline this year to 35%. Aluminium for delivery in three months was little changed at $1,593 a metric ton on the London Metal Exchange and is trading at less than half its July 2008 peak. A decision to issue a payout to shareholders comes as...
