Top aluminium producers underline the importance of aluminium scrap utilization

The nonferrous market in Europe may be finding some solid footing, which could be good news for the overall health of most nonferrous metals markets there.

One sticking point continues to be China, which continues to send mixed signals on its economy. For aluminium, after a modest price rally, the metal has fallen quite significantly. Reflecting the challenges for European handlers of aluminium has been the drop in aluminium premiums. Various reports note that aluminium premiums in Europe have fallen by around 42% this year from last year’s level.

Despite some difficulties, there does appear to be improved demand in a number of countries, with a sense that buying could start to strengthen later this year.

Adding the positive signals, the European aluminium producer Norsk Hydro completed the acquisition of the German recycling company WMR Recycling in early April. The move is an indicator that aluminium producers are looking to strengthen their positions in the scrap sector.

In acquiring the operation, Roland Scharf-Bergmann, head of recycling in Hydro’s primary metals business, says, “The scrap-sorting technology in the WMR plant is the most advanced in the world, and we will now hold the patented rights to this technology.”

Scharf-Bergmann says efficient scrap sorting will be more important for the industry in the years to come.

“Only when we sort the scrap effectively can we utilise the positive recycling properties of aluminium to the full extent,” Scharf-Bergmann explains.

Novelis, another large aluminium producer, already has been building up its scrap aluminium handling capabilities with the October 2014 opening of what the company says is the largest aluminium recycling facility in the world, adjacent to its rolling mill in Nachterstedt, Germany. When fully operational the recycling center will process up to 400,000 tonnes of aluminium scrap per year.

Meanwhile, the shipments of aluminium from China have likely reached their peak during the first quarter of the year when exports increased by 43% from the same time last year.