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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Utkal Alumina's Project Saksham: Empowering women in a meaningful way
Utkal Alumina International Limited (UAIL), a unit of Aditya Birla Group, has launched Project Saksham, an advanced training-cum-garment manufacturing unit, at Tikiri in Rayagada district, to help unemployed rural women eke out a sustainable livelihood and become self-reliant. Commenced in February 2015, the project now imparts training to 38 women from the underprivileged sections of society, living in the surrounding villages of the plant. With 30 Juki make industrial sewing machines and four specialised machines, these women have already received a six month training on operation and product development, including quality control, to cater to the market demand. During the training period, participants learnt basic machine operations, cutting and stitching of fabric to make various...
Rio Tinto doubles capacity at its Yarwun alumina refinery
Rio Tinto Alcan, one of the world's leading mineral and metal conglomerates, is in the process of doubling the capacity of the alumina refinery at Yarwun. The construction work is almost near completion. The official opening ceremony of the upgarded section took place recently. Campbell Newman, the former Australian politician who served as the 38th Premier of Queensland from 2012-2015, declared the upgraded section open. The construction job was carried out by Bechtel and it had taken five years to finish. The total cost of the project was $2.5 billion. Hundreds of workers lined up on the day as dignitaries and industry bosses listened to then-general manager Mike Dunstan describe the importance of the achievement. The expansion more than doubled production at the refinery to 3.4 million...
List of bauxite mines on auction pruned by Indian government
The list of aluminium ore mines to be auctioned has been pruned. The revised list contains much lesser number of bauxite mines than what was decided earlier. It is quite a setback for the Indian aluminium industry. Against the plan to auction about 90 major mineral mines in 2015-16, the mines ministry is now left with just about 71 mines where the bidding process could start by November this year. “Few mines had to be removed from the earlier list as total station survey conducted by Mecon revealed that some mines were in naxal-prone areas, some faced land disputes while others had overlapping boundaries. In a few cases, Mecon officials were not allowed to conduct survey by the locals,” said mines secretary Balvinder Kumar. This spells bad news for companies such as Vendanta Aluminium who...
India primary aluminium output to hit 2.5 mt in FY2015-16
India’s primary aluminium output will hit 2.5 million tonnes in fiscal 2015-2016, observed Nalco’s managing director T K Chand. India’s demand for the light metal grew significantly in 2014 due to increasing investment by the central government in power transmission, a trend that is likely to continue through 2015, T K Chand was quoted as saying. In particular, beverage cans, alloy wheels, automobile bodies, railway coaches will be important drivers of aluminium consumption in coming years, T K Chand added.
Hydro enters LoI with Vale to raise MRN ownership to 45%
Hydro has signed a Letter of Intent (LoI) with Brazilian mining company Vale for the possible acquisition of Vale's 40 % interest in Brazilian bauxite producer Mineração Rio do Norte (MRN), which would strengthen Hydro's global position as a long player in bauxite and alumina. An eventual agreement will depend on the parties agreeing terms for Hydro to acquire Vale's 40% interest in MRN, completion of Hydro's due diligence process, approval by the parties' Board of Directors and by the relevant competition authorities. The parties will also seek support from the other MRN shareholders to the transaction and will proceed in accordance with the terms of the shareholders' agreement. MRN's current shareholders are Vale (40%), Alcoa (18.2%), South 32 (14.8%), Rio Tinto (12%),CBA (10%) and...
Global aluminium supply glut to increase by 20 million mt in 2019
The latest available data suggests the rising supply situation is likely to further inflate the global aluminum stock levels. The stock levels are most likely to exceed 20 million mt in 2019, the research note said. According to the analysts, the rapid pace of growth in the metal supply poses big threat to the market. Aluminum inventory levels had hit record highs of 13.7 million mt at the end of 2014. The global aluminum supply witnessed a growth of 8.8% as against the demand growth of 6.6% during the year. The demand is expected to outpace supply growth during 2015 to 2020. Despite this, global aluminum inventory levels are expected to increase in the wake of increased exports of semi-finished products from China. Further, lower energy costs may ramp up aluminum production around the...
Alcoa reports profit for third quarter 2015
Lightweight metals leader Alcoa reported a third quarter profit as its value-add and upstream portfolios delivered solid results in the face of strong market and currency headwinds. Alcoa has been transforming by building its value-add portfolio for profitable growth and creating a globally competitive upstream business. The company’s successful multi-year transformation will culminate with the launch of two Fortune 500 companies, one value-add focused and the other upstream focused, expected in the second half of 2016. Alcoa reported third quarter 2015 net income of $44 million, or $0.02 per share, including $65 million in net unfavourable special items. Special items included restructuring-related costs to optimize the upstream portfolio and transaction costs, partially offset by gains...
LME aluminium neutral in $1,545-$1,573 range
LME aluminium looks neutral in a range of $1,545-$1,573 per tonne, and an escape will point a direction. The range is formed by the October 2 low and the 50 percent Fibonacci projection level of an upward wave c, the third wave of a three-wave cycle from the August 24 low of $1,506. A break below $1,545 could cause a loss to $1,517, based on the range of $1,545 and $1,573, while a break above $1,573 could open the way towards $1,588, the 76.4 percent level.
CARE cuts rating for Hindalco debentures
Credit Analysis and Research Ltd. (CARE), one of the world's premiere credit rating agencies, has revised its grade for Hindalco Industries' non-convertible debentures from 'AA+' to 'AA' on continued moderation in profitability and debt protection parameters. The debt amount involved is INR 6,000 crore. Hindalco is part of the Aditya Birla Group. The rating is also AA for the long-term and short-term bank facilities, of INR 31,059 crore. The latter ratings and revision in the long-term one for the debentures factor in the continued moderation in the profitability and debt protection parameters, as compared to the envisaged levels. The ratings also factor in the increased cost of production due to premium paid for acquisition of captive coal mines in auctions held in February 2015, CARE...
SMM aluminum market morning review
LME aluminum shot up to USD 1,592/mt after opening at USD 1,559/mt on October 7. The light metal fell back later in the day, but then rallied to USD 1,577/mt. In overseas market, the euro zone’s final manufacturing PMI was 52.0 in September. ISM’s US manufacturing PMI was 50.2 in September, slightly below 50.6 expected. The US non-farm sector created just 142,000 jobs in September, shy of 201,000 expected. US jobless rate was 5.1% in September, unchanged from August. Depressed data eased expectations for rate hike later this year. The US dollar index fell from 96.2 on September 30 to 95.4 on October 7 as a result. Global stock market rose during the week-long holiday in China. Dow Jones industrial index rose to 16,766 on October 7 from 16,285 on September 30. In China’s domestic market,...
MAN Industries' shares surge on bagging orders worth INR 700 crore
MAN Industries shares surged over 7 per cent in the morning trade on September 8, Thursday, after the company informed Bombay Stock exchange (BSE) on Wednesday post market hours that it has received orders worth approximately INR 700 crore from international and domestic customers for supply of pipes for Oil, Gas and Water sector projects. In a BSE filing, the company said, “With these new orders the outstanding order book as on date stands at approximately INR1,300 crore to be executed over a period of 6 to 8 months, this will result in significant improvement in the coming quarters.” The company has upgraded its Pithampur plant with the enhanced capabilities to become pioneer to produce Pipes up to 3600 mm dia metere with coating facilities. The company has outstanding bids around $ 1.5...
American Specialty Alloys continues with aluminium alloy project as Revolution Aluminum
Construction and installation work at the $2.4 billion aluminum alloy plant in the Pineville area, Louisiana, will still continue, but it will do so under a new name. American Specialty Alloys has changed its name to Revolution Aluminum LLC, although its original name is yet to show up on its website. As American Specialty Alloys, often referred to as ASA, the company announced earlier this year that it will build an aluminum alloy plant at the former site of the International Paper mill near Pineville. “The project is still moving ahead,” said Jim Clinton, president of the Central Louisiana Economic Development Alliance. He was familiar with the company name change. The company has been planning the name change for a while, and documents involving the company are being changed to reflect...
Rexam joins hands with WeCan for UK’s first mobile canning facility
Rexam has teamed up with WeCan Solutions to produce aluminium cans for the first ever mobile canning facility in the UK, one of only a handful in Europe. The pioneering service, backed by Rexam, offers onsite canning solutions for craft brewers and smaller beverage brands with a minimum filling run of 5,000 cans per day. The collaboration sees Rexam providing 330ml (33cl) size cans in a range of formats, including unprinted, one-colour printed and bespoke designs, on demand. In addition, WeCan Solutions offers the application of pressure sensitive labels (PSL) for onsite filling. The partnership highlights both companies’ dedication to helping craft brewers recognise the benefits of cans as an alternative packaging format, whilst reducing investment costs on filling lines and...
Chinese National Day holiday hits India aluminium scrap, MCX aluminium prices
India major aluminium scrap commodities prices declined on Tuesday, September 6, in line with aluminium futures prices at India's Multi Commodity Exchange (MCX) as Chinese markets remained closed for its National Day holiday. The major aluminium scrap commodities dropped on Scrap Register Price Index as on Tuesday. India's major scrap commodities like aluminium accessories scrap, aluminium rod local, aluminium sheet cutting, aluminium wire scrap traded down on Tuesday. The most active October aluminium contract on Multi Commodity Exchange settled down by 0.2% to INR 100.50 per kilogram on Tuesday from previous close of INR 100.70 per kilogram. The MXC aluminium prices touched an intra-day high of INR 101.50 per kilogram and an intra-day low of INR 100.20 per kilogram during Tuesday. The...
Clarendon Alumina Production continues losing money
Clarendon Alumina Production Limited (CAP) advises that it has produced 2015 accounts but that these have not yet been laid before the annual general meeting or Parliament. It is unclear how the Government of Jamaica, and in particular, the otherwise progressive Ministry of Finance, does not have a defined policy that the audited accounts can be made available as soon as the audit has been completed. The long delay for the minister to review accounts and place them before Parliament must be embarrassing to the various state companies like CAP that produce their accounts on a timely basis. The March 2014 accounts show that CAP had an income of US$157 million, and that after payment of its cost of sales, totalling US$212million, administrative and finance costs and taxation, it showed a net...
Rusal Aughinish back to pre-tax losses despite revenue rise
The largest alumina refinery in Europe, Rusal Aughinish, last year went back into the red to record pre-tax losses of $12.2m (€10.8m). The loss came despite revenues having increased by $22m from $607.8m to $629m. Based on the Snannon estuary, the principal activity of Limerick Alumina Refining Ltd and subsidiaries is the production and sale of alumina. Separate figures provided by Aughinish Alumina to the Environmental Protection Agency confirm the output at the refinery was 1.955m tonnes of alumina hydrate, representing a marginal increase on the 2013 output. The plant extracts alumina from bauxite, the firm sources around 70% of the bauxite processed at the refinery from Guinea in Africa with the remainder coming from Brazil. The finished product, alumina, is exported for smelting to...
AAI pitches for a safeguard duty in meeting with India's Revenue Secretary
Facing the twin onslaught of galloping imports and meltdown in global prices, the domestic aluminium industry on Wednesday made a strong pitch for a safeguard duty breather in its meeting with revenue secretary even as its demand for doubling import duty to 10% remains unanswered. Sources said representatives from all three major domestic aluminium producers - Vedanta, Hindalco and Nalco - under the aegis of Aluminium Association of India (AAI) met revenue secretary Hasmukh Adhia and appraised him that since 55% of domestic demand is being met through imports, nearly half of their 2.1 MT capacity is lying unutilised. “The prices of the metal have also crashed. Since April 2011, aluminium prices at London Metal Exchange (LME) have dropped by 42% from $2,623/tonne to $1,540/tonne in August...
Power cost- the key factor to limit Chinese aluminium smelters’ competitiveness
Escalating power cost is going to be the single critical factor for the Chinese aluminium smelters trying to stay competitive in the domestic as well as international market- China Cheng Xin International Credit Rating Co. (CCXI) made this observation amid slowing Chinese economy and somewhat declining demand for aluminium. Currently, Chinese aluminum smelters source power mainly in three ways: grid power, captive power, or by purchasing power directly from power plants. High grid power tariffs are increasingly making aluminum smelters economically unviable against falling aluminum prices . Local governments are encouraging aluminum smelters to sign power purchasing agreement directly with local power plants via a market-based mechanism. This has helped reduce cost of production to a...
