Global Aluminium Market Report and Forecast 2024-2032

Global Aluminium Market Size

The global aluminium market attained a value of 157.03 billion in 2023. The market is expected to grow at a CAGR of 5.65% between 2024 and 2032, reaching almost a value of 257.42 billion by 2032.

Global Aluminium Market Outlook

• Aluminium recycling is highly efficient, requiring only 5% of the energy used to produce primary aluminium, which significantly reduces the carbon footprint.

• There is an increased low-carbon aluminium demand produced with renewable energy or through processes that emit less CO2.

• The growing aluminium demand in India is the result of continuous expansion of the transportation, construction, and power sectors.

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Global Aluminium Market Share

The growing construction sector in developing countries like India and China is driving the aluminium market growth. These countries are witnessing an increased rate of construction to expand their infrastructure and meet the demand of the rising population due to its rapid migration to big cities. The rising use of aluminium as a material of choice in electrical engineering as well as the machinery and equipment sector are also driving the growth of the aluminium market. Moreover, the increased application of the product in making aluminium sheets to replace steel is also a crucial factor pushing the demand.

Recent Developments

Recycling and sustainability; the shift towards low-carbon aluminium; technological advancements; and global trade policies are the major trends impacting the growth.

Aluminium Market Trends

Aluminium Market Growth

The emphasis on sustainability within the aluminium sector has significantly enhanced the value of recycling aluminium, aiding the growth of the aluminium market. This shift is largely because recycling aluminium consumes only 5% of the energy required to produce aluminium from raw materials, such as bauxite. Moreover, by incorporating more recycled aluminium into production processes, the aluminium market can significantly reduce its reliance on virgin aluminium, which requires energy-intensive mining and refining processes. Enhancing the efficiency and effectiveness of the aluminium recycling process is crucial for accelerating the sector's transition towards sustainability.

The Every Can Counts campaign, initiated by Emirates Global Aluminium in partnership with beverage can manufacturers Crown and CANPACK, in February 2024, is a strategic effort designed to encourage consumer participation in recycling aluminium beverage cans. This initiative is part of a broader movement towards sustainability and the promotion of a circular economy, where resources are reused and recycled to minimise waste and reduce environmental impact.

Industry Outlook

As per aluminium industry analysis, since 2018, to 2022, the aluminium industry across the world has shown trends and regional nuances. According to the International Aluminium Institute, global aluminium production reflects a persistent increasing trend reflective of a strong growth period for the sector. For the past five years, global aluminium production has leaped from 64,166 thousand metric tonnes in 2018 to a very strong 69,038 thousand metric tonnes in 2022. This dramatic increase of 7.6 percent underscores how the industry reacted positively to misfortunes and challenges and increased in capability. This rise was matched by the daily average production, which went up from 2,069.9 to 2,164.3 thousand metric tonnes during that very period—an epitome of efficiency and capacity for the sector with regard to scaling.

On a worldwide scale, China has more or less strongly established itself as a lead producer of primary aluminium. Its contribution increased from 36,485 thousand metric tonnes in 2018 to 40,430 thousand metric tonnes in 2022, resulting into new aluminium market dynamics and trends. In other words, more than half of the global supply consisted of production originating in China. It is not only a demographic fact relating to the humongous capacity built-up but also how smartly they have been positioned in the market and what kind of industrial policies they had in place. Meanwhile, the GCC countries have made their mark with a steep growth trajectory from 5,331 thousand metric tonnes in 2018 to 6,074 thousand metric tonnes in 2022. It means that this region has huge investments in infrastructure and technology to support aluminium production.

The scenario of North America's aluminium production is one of stability and maturity, with minor fluctuations noted. Production slid a bit in this region from 3,774 thousand metric tonnes in 2018 to 3,743 thousand metric tonnes in 2022—an indication that the market is stable but growth-constrained. Similarly, Russia & Eastern Europe have had modest rises; the region is forecast to increase from 4,049 thousand metric tonnes in 2018 to hit 4,081 thousand metric tonnes in 2022. This consistent growth in Europe reflects a robust aluminium industry globally but with incremental growth.

On the negative side, Western & Central Europe has experienced a decline. The production in this region dropped from 3,733 thousand metric tonnes in 2018 to 2,913 thousand metric tonnes in 2022. This decline represents likely future challenges related to regulatory changes, rising energy costs, and strategic repositioning within the industry. The trends in Asia, excluding China, were different. The production figures moved from 4,415 thousand metric tonnes in 2018, peaking at 4,499 thousand metric tonnes in 2021, to finally rest at 4,591 thousand metric tonnes in 2022. That growth is a very promising development of production capabilities outside of China and marks one of the larger trends toward diversification of global aluminium sources.

While Africa and Oceania have kept up relatively stable production levels, the latter has actually witnessed slight declines. Production in Africa dropped from 1,668 thousand metric tonnes in 2018 to 1,620 thousand metric tonnes in 2022, indicating that despite a stable presence, there is a fledgling market. For Oceania, there has been a slight decline, too, from 1,917 thousand metric tonnes in 2018 down to 1,843 thousand metric tonnes in 2022, indicating stable operations amidst global market pressures. The decline was much more precipitate in South America, from 1,164 thousand metric tons in 2018 to 1,288 thousand metric tons in 2022, denoting economic and operational challenges characteristic of that region.

An interesting trend of global aluminium market was that, whereas the unreported production to the International Aluminium Institute increased from 1,630 thousand metric tons in 2018 to 2,455 thousand metric tons in 2022, the rise might connote a growing volume of aluminium production outside of the main reporting channels, probably indicative of new market entrants or expansion of smaller-scale operations not yet integrated into formal reporting structures.

Global imports of aluminium plates, sheets, and strips increased significantly from USD 32,426,244 thousand in 2019 to USD 49,064,969 thousand in 2022 and fell slightly to USD 36,870,500 thousand in 2023. This analysis is sourced from ITC Trademap.

The global aluminium market has thus posted strong growth with changing dynamics from 2018 to 2022. Strong drivers, like China and the GCC, have been behind high production increases, while others such as North America, Russia & Eastern Europe, and Asia (ex-China) have been holding rather stable output levels. At the opposite end, the decline of Western & Central Europe and an increase in unreported production underline shifting dynamics of the market and rising challenges. These facts, based on the International Aluminium Institute, present the profile of a dynamic, multi-faceted industry that is positioned to continue its evolution in the coming years and eventually boost aluminium industry revenue.

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Aluminium Industry Segmentation

“Aluminium Market Report and Forecast 2024-2032” offers a detailed analysis of the market based on the following segments:

Primary aluminium maintains its dominance in the market due to its growing usage in multiple end-use sectors

The primary segment holds a substantial aluminium market share globally. The process for primary aluminium involves mining bauxite, refining it into alumina (aluminium oxide), and then using the Hall-Héroult process to smelt alumina into aluminium. Primary production is energy-intensive, requiring a significant amount of electricity to convert alumina into pure aluminium. The demand for primary aluminium is driven by its necessity in producing high-purity aluminium for critical applications in sectors like aerospace, automotive, and electronics, where material properties such as strength, conductivity, and corrosion resistance are paramount.

The secondary segment is also expected to witness a robust growth as the production of secondary aluminium involves the melting of scrap metal to produce new aluminium. This process is far less energy-intensive than primary production, consuming only about 5% of the energy required to produce the same amount of aluminium from bauxite. The environmental benefits, coupled with the economic advantages of lower energy costs, are driving an increase in the recycling rate. It is enhancing the use of recycled aluminium across various sectors and hence driving the growth of aluminium market.

The consumer electronics segment occupies a major aluminium market share due to its lightweight and cost-effectiveness

As aluminium is lightweight and cost-effective, it finds extensive applications in the production of consumer electronics. Thus, the growing demand for laptops, smartphones, and tablets favours market growth. Some aluminium manufacturers also offer innovative and superior aluminium alloys, which in turn, aids the use of metal in complex designing solutions in consumer electronics. Further, the rising utilisation of aluminium as a substitute for plastics and steel owing to its reliability, versatility, high mechanical strength, cost-effectiveness, and lightweight is likely to augment the segment growth.

The transportation sector is expected to witness a robust growth in the forecast period, as aluminium finds wide applications in the development of transportation systems and plays a crucial role in automotive applications. The increasing environmental concerns fuel the demand for electric vehicles, which further adds to the demand of global aluminium market.

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Global Aluminium Market Regional Analysis

China continues to lead with the continuous expansion of its production capacity and the adoption of advanced technologies, attaining economies of scale and bringing down the cost while increasing efficiency in production. State support and strategic investments in innovations further shore up China's competitive advantage.

GCC countries, particularly the UAE and Saudi Arabia, are taking aggressive investments in new, modern aluminium-producing projects capable of operating competitively. With ample energy resources available at low costs, these countries can ensure competitive prices and high volumes of production. Partnerships with global technology providers enhance their operational efficiency and growth of the aluminium industry.

To handle stringent new environmental regulations and rising energy costs, North American producers are now looking to innovation and sustainability. Investments that Alcoa and Novelis are making in advanced recycling technologies and lightweight aluminium alloys are targeted at high-tech industries such as aerospace and automotive, thereby helping both companies to stay competitive.

European Aluminium producers are leading the way in green technologies and circular economy enablers. The goal of reducing carbon footprint through the use of renewable energy and increasing recycling rates puts European companies at the forefront of a new epoch in sustainable aluminium production. This is further sealed through collaborations with environmental organizations and compliance with very strict EU regulations.

If Russian and Eastern European enterprises are to stay competitive, they will also have to focus on cost efficiency and market diversification to increase the aluminium market revenue over the years. Players will use the wealth of natural resources and relatively lower production costs to target traditional and new emerging markets. Modernization of existing facilities and improvement in supply chain logistics are other important investment areas.

Operational flexibility and regional market focus of the producers in non-China markets, especially India and Japan from the Asia region, form the foundation. These companies are agile and responsive to the markets as they adjust their product mix to regionally specific demand and source from local resources. Regional automotive and electronics manufacturers drive their growth with strategic partnerships.

Considering the aluminium demand forecast and predictions, African aluminium producers are rapidly becoming major players through strategic alliances with global technology companies and investors. Companies that would like to establish production capacity and operational efficiency are gradually increasing their market share. Their competitive strategy is, therefore, critically dependent on investment in infrastructure and skills building.

In view of globalization, Oceania—most particularly Australia—has been focused on the need to specialize and produce goods of high quality to enter the global markets. Specialized premium aluminium products for countries such as Australia, coupled with tight controls along upstream value chains, can keep standards very high to make entry into higher-value markets achievable, like aerospace and defence. The investments in sustainability practices and renewable energy further strengthen their market position and helps in boosting the aluminium demand growth.

From multiple competitive strategies aligned to regional strengths and market demands, the global aluminium market goes right through technological integration to sustainable product development and cost efficiency, strategic partnerships, and more. The key players use diversified means to secure their competitive advantage and drive growth in this dynamic industry.

Key Factors Fuelling the Global Aluminium Market

• Aluminium is an integral factor in industries ranging from automotive and aerospace to construction, packaging, and electronics.

• Continuously improving production technologies and processes raise efficiency and bring down costs.

• Stable supplies to match world demand are ensured by dominant producers like China and GCC.

• Enhanced sustainability with the recyclability of aluminium and reducing carbon emissions.

Challenges Faced by The Producers in The Global Aluminium Industry

• High energy intensity of aluminium production affects the cost and competitive position.

• Strict environmental legislation adds to costs and burdens related to compliance.

• Geographical concentration of a large part of worldwide production in only a few regions, in particular China.

• High capital investment in production capacity puts a limitation on expansion and decreases the aluminium market value.

The course of Events Driving Growth in the Aluminium Market

• Rapid industrialization and urbanization provide huge growth prospects.

• Material science innovations drive new applications for high-tech industries.

• Sustainable focus drives demand for recycled aluminium, enhancing the aluminium market revenue.

• Joint ventures and investments ensure innovation and efficiency.

Threat of Substitutes Affecting the Aluminium Market

• Global economic instability could cool demand and result in an oversupply in the aluminium market.

• Trade tensions and geopolitical conflicts may give rise to the risk of supply chain disruptions and loss of market access.

• Stealing share in some applications from aluminium could be a result of increased usage of substitute materials.

• This increased awareness, coupled with a preference for greener alternatives, places aluminium in an environment where increasingly stringent regulations could challenge its hold on the market.

Competitive Landscape

The global aluminium market is very competitive, with a few major players constituting the market: Alcoa Corporation, Rio Tinto Group, China Hongqiao Group, Rusal, Norsk Hydro, Emirates Global Aluminium, Aluminium Corporation of China Limited, Hindalco Industries, South32, and Novelis Inc. The strengths of a company are the means to hold onto and grow market share in an ever-changing dynamic and challenging landscape.

Those that have technological innovations and strategic management of resources include Alcoa Corporation and Rio Tinto Group. China Hongqiao Group and Chalco have held a pure scale effect through large production volume to influence global pricing and supply dynamics. However, their dominance is challenged by Rusal and Norsk Hydro, who create a niche in sustainability and technological innovation.

Firms such as EGA and Hindalco Industries have been able to differentiate based on geographic focus and core competence. EGA benefits from its strategic location in the UAE, efficiently servicing Europe, Asia, and the Middle East. Hindalco is an integrated Aditya Birla Group company—from mining to making and selling products, ensuring cost control and efficiency in supply.

Added to this are the focus areas that South32 and Novelis Inc. bring with them. South32 works on mining, thereby ascertaining the stability of the supply of raw materials; Novelis leads in rolling and recycling aluminium, with the capability to cater to industries such as automotive and beverages while laying more emphasis on sustainability. The result is an intensely competitive situation breeding continuous innovation in the industry and disrupting the aluminium market opportunities.

The market players are focusing on improving their production capacity and making the process production process more sustainable to gain a competitive edge in the market

Other players in the aluminium market include Alcoa Corporation, Emirates Global Aluminium PJSC, Shandong Xinfa Aluminum Co., Ltd., Norsk Hydro ASA, Vedanta Limited, and Hindalco Industries Limited, among others.

Key Highlights of the Report

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