“For 2022 we will see high aluminium prices throughout the year and even further on. This will increase investments in the aluminium sector and therefore the project pipeline will further grow”, Patrik Ernst - Director Aluminium Division at REEL International

AlCircle: What was the motive behind the screen that drove REEL International to acquire the Aluminium Emission Control business of GE Steam Power in Norway?

Mr Patrik Ernst: Over the last years REEL realized that our clients would always go for bigger packages when executing either brownfield or Greenfield projects in the aluminium industry. This was particularly true in the courtyard of an aluminium smelter where the Gas Treatment Center (GTC) was often awarded together with all materials handling equipment. With the expert materials handling company Alesa already in the REEL portfolio, the missing link was the emission control aspect to provide our clients out of one hand the full courtyard portfolio. REEL has worked in the past with the emission control team of GE either as a supplier or as a partner on various projects, therefore we knew of the compatibility of both teams. When the opportunity arrived to take over the team in Norway, REEL worked diligently with the former owner to guarantee a smooth transition. REEL Norway is today integrated as a business line within REEL Alesa.

AlCircle: How do you conceptualize 2022 for the global aluminium industry following the Covid economic impact?

Mr Patrik Ernst: The low aluminium prices before COVID and the Pandemic situation in the last couple of years saw low investment activity in the sector and therefore small project activity which represented a difficult situation for many suppliers to the aluminium industry. However, this situation offered as well opportunities for consolidation in the industry.

For 2022 we will see high aluminium prices throughout the year and even further on. This will increase investments in the aluminium sector and therefore the project pipeline will further grow. In addition, the trend for green aluminium will continue which will further increase project activity. REEL is well-positioned to participate in the transformation of aluminium production towards a reduced carbon footprint.

AlCircle: How would you rate REEL International’s 2021 overall performance and also segmented to the aluminium business?

Mr Patrik Ernst: Considering the Pandemic environment, 2021 was a solid year for REEL with acceptable margins. As far as the REEL Aluminium Division is concerned, the focus was to integrate the new acquisitions which are well underway. In regards to profitability, 2021 represented a weaker year but still with a positive result.

AlCircle: Could you brief us on REEL International’s projections for 2022 specific to the aluminium business?

Mr Patrik Ernst: We see an increased order intake in the Aluminium Division resulting in a higher workload for all of our Business Units and we expect after we made three acquisitions in 2021 to finalize their integration process in 2022.

AlCircle: REEL International is quoted as ‘A major player in equipment and solutions dedicated to the aluminium industry.’ What are your insights in regards to the industry countering the surge in energy prices & production curb?

Mr Patrik Ernst: The push in the car industry for battery-powered vehicles will accelerate the use of light metals such as aluminium; therefore the demand will be solid over the next years which will result in adequate metal prices. Further, the push to reduce carbon emissions in our industry and the trend for nearshoring will create an additional project pipeline as investments will flow into the Aluminium Industry. Obviously, GEO political developments cannot be predicted and are excluded from our view.

AlCircle: What will be REEL International’s focal point in terms of investment and expansion in 2022? Is any new acquisition anticipated in the year?

Mr Patrik Ernst: REEL will be focusing to finalize the consolidation process of its aluminium business. However, acquisition opportunities will always be considered should they fit into the portfolio.

AlCircle: In 2021, the world witnessed the aluminium price reach the highest since 2008, but in adverse it has also been observed a few smelters closed down their entire operation. How does REEL International respond on this matter?

Mr Patrik Ernst: Various smelters which have been closed down were not accessible to REEL. Nearshoring, green aluminium, restart and expansion of smelters/potlines in the accessible markets to REEL will further increase our project activities. We, therefore, do not see the closing down of some smelting capacities in the Far East as a threat but as an opportunity.