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Released January 11, 2022 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--With demand and prices on an upswing, North America's aluminum producers are celebrating an accomplishment that bodes well for its future in a more environmentally conscious industry: The carbon footprint for primary aluminum production has declined 49% since 1991, while the footprint for recycled aluminum production has dropped 60%, according to a report from The Aluminum Association (Arlington, Virginia). Industrial Info is tracking nearly $5.5 billion worth of aluminum-production projects in the U.S. and Canada.
"That's probably not surprising, considering a good deal of U.S. production has been shut down during this period," said Joe Govreau, Industrial Info's vice president of research for the Metals & Minerals Industry. "U.S. primary aluminum production has declined significantly since 1991, decreasing from 4.5 million tons per year in 1991 to about 1.1 million tons per year in 2021. A good deal of U.S. capacity was shut down in the 1990 and 2000s due to high energy costs, making it difficult to compete with countries such as China, which overtook the U.S.'s leading position. Today, the U.S. gets about 50% of its aluminum imports from Canada, which produces about three times as much aluminum using clean hydroelectric and nuclear electricity. Nevertheless, tariffs and supply-chain issues have boosted domestic aluminum production."
The report also attributes this trend to the growing popularity of recycled aluminum, which it says is 94% less carbon-intensive than primary aluminum. Norsk Hydro ASA (Oslo, Norway), one of the world's largest aluminum companies, is among those turning to aluminum recycling. Hydro Aluminum Metals USA LLC, a subsidiary, is planning to build a $140 million aluminum recycling plant in Cassopolis, Michigan, to produce up to 120,000 metric tons per year of aluminum extrusion ingots, which are products cast into a specific size and shape (such as a bar, plate or sheet) by pouring molten aluminum into molds.
"The Cassopolis greenfield development will mark the first large-scale production of Hydro CIRCAL extrusion ingot in North America," the company said in a press release. "Hydro CIRCAL extrusion ingot contains at least 75% post-consumer scrap certified by third-party auditors DNV GL and has a market-leading CO2 footprint." Norsk says the high-quality aluminum will meet all requirements for automotive and other applications.
Construction on the Cassopolis project is currently expected to kick off toward the middle of the year. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can learn more from a detailed project report.
Click on the image at right for a graph detailing the top parent companies for secondary (recycled) aluminum projects across the U.S. and Canada, by investment value.
While the Cassopolis project is under construction, Norsk Hydro plans to deliver initial quantities of Hydro CIRCAL to its U.S. customers from its secondary aluminum smelter in Commerce, Texas, before the end of 2021. Subscribers can learn more about this facility from Industrial Info's plant profile.
Matalco Incorporated, a subsidiary of Triple M Metal LP (Brampton, Ontario), began construction in August on a $53.5 million aluminum ingot plant in Franklin, Kentucky, which is designed to produce 270 million pounds per year of alloyed ingots from recycled aluminum for customers throughout the U.S. Midwest. The project is currently set to be completed in the third quarter of 2023. Subscribers can learn more from Industrial Info's project report.
Aluminum recycling is playing a bigger role in the development of lithium-ion batteries, which are used in most all-electric and hybrid vehicles. In response to the growing demand for this technology, recycling-tech startup Momentum Technologies (Dallas, Texas) is proposing a lithium-ion battery-recycling plant in Dallas that would use its own Membrane Solvent Extraction technology to strip and extract aluminum, cobalt, nickel, copper and other metals from electronic waste. The project picked up support in December when Freestone HoldCo, LLC, a subsidiary of Tailwater Capital LLC, agreed to lead a $20 million investment in Momentum Technologies. Subscribers can learn more from Industrial Info's project report.
Reviving Demand Rejuvenates Hard-Hit Facilities
Following a difficult 2020, in which the COVID-19 pandemic created widespread uncertainty across end markets, aluminum producers saw demand gradually improve throughout 2021. Container shortages and shipping delays--much of which is related to the ongoing supply-chain crunch--have hiked demand and prices for aluminum in the meantime. Global aluminum inventory has fallen to levels not seen since the end of the Great Recession--which, along with the global deficit, should keep aluminum prices elevated in the near term.
"On the demand side, we have seen consumption return to pre-COVID levels and expect the 2021 demand growth will be nearly 10% from 2020 levels," said Jesse Gary, the chief executive officer of Century Aluminum Company (NASDAQ:CENX) (Chicago, Illinois), in the company's most recent quarterly earnings-related conference call. "This growth comes despite headwinds in automotive and aerospace, given the semiconductor shortage and lower commercial airline travel, respectively. Recovery in these lagging sectors in 2022 would help drive continued demand growth in 2022 and beyond."
The revival in aluminum demand spurred Century Aluminum to reopen a potline at its Mount Holly Aluminum Smelter in Goose Creek, South Carolina, that had been closed since 2015. Phase I, which kicked off in January 2021, will increase overall plant capacity from 115,000 to 140,000 tons per year; upon completion, Phase II will begin and eventually bring nameplate capacity to 170,000 tons per year. Subscribers can read detailed project reports on Phase I and Phase II.
"In the U.S., demand [in third-quarter 2021] was up 12% from prior year, while supply was down 2%," said Peter Trpkovski, the head of investor relations at Century Aluminum, in the company's most recent quarterly conference call. "In Europe, demand was up approximately 16% from [third-quarter 2020] and supply growth was up only 3%. We continue to see these two markets as the shortest markets in the world, and that will carry into next year and beyond. As we saw last quarter, demand continues to outpace supply growth around the world, and the global aluminum market is now projected to be in a 1.5 million-ton deficit [for full-year] 2021."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
"That's probably not surprising, considering a good deal of U.S. production has been shut down during this period," said Joe Govreau, Industrial Info's vice president of research for the Metals & Minerals Industry. "U.S. primary aluminum production has declined significantly since 1991, decreasing from 4.5 million tons per year in 1991 to about 1.1 million tons per year in 2021. A good deal of U.S. capacity was shut down in the 1990 and 2000s due to high energy costs, making it difficult to compete with countries such as China, which overtook the U.S.'s leading position. Today, the U.S. gets about 50% of its aluminum imports from Canada, which produces about three times as much aluminum using clean hydroelectric and nuclear electricity. Nevertheless, tariffs and supply-chain issues have boosted domestic aluminum production."
The report also attributes this trend to the growing popularity of recycled aluminum, which it says is 94% less carbon-intensive than primary aluminum. Norsk Hydro ASA (Oslo, Norway), one of the world's largest aluminum companies, is among those turning to aluminum recycling. Hydro Aluminum Metals USA LLC, a subsidiary, is planning to build a $140 million aluminum recycling plant in Cassopolis, Michigan, to produce up to 120,000 metric tons per year of aluminum extrusion ingots, which are products cast into a specific size and shape (such as a bar, plate or sheet) by pouring molten aluminum into molds.
"The Cassopolis greenfield development will mark the first large-scale production of Hydro CIRCAL extrusion ingot in North America," the company said in a press release. "Hydro CIRCAL extrusion ingot contains at least 75% post-consumer scrap certified by third-party auditors DNV GL and has a market-leading CO2 footprint." Norsk says the high-quality aluminum will meet all requirements for automotive and other applications.
Construction on the Cassopolis project is currently expected to kick off toward the middle of the year. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can learn more from a detailed project report.
Click on the image at right for a graph detailing the top parent companies for secondary (recycled) aluminum projects across the U.S. and Canada, by investment value.While the Cassopolis project is under construction, Norsk Hydro plans to deliver initial quantities of Hydro CIRCAL to its U.S. customers from its secondary aluminum smelter in Commerce, Texas, before the end of 2021. Subscribers can learn more about this facility from Industrial Info's plant profile.
Matalco Incorporated, a subsidiary of Triple M Metal LP (Brampton, Ontario), began construction in August on a $53.5 million aluminum ingot plant in Franklin, Kentucky, which is designed to produce 270 million pounds per year of alloyed ingots from recycled aluminum for customers throughout the U.S. Midwest. The project is currently set to be completed in the third quarter of 2023. Subscribers can learn more from Industrial Info's project report.
Aluminum recycling is playing a bigger role in the development of lithium-ion batteries, which are used in most all-electric and hybrid vehicles. In response to the growing demand for this technology, recycling-tech startup Momentum Technologies (Dallas, Texas) is proposing a lithium-ion battery-recycling plant in Dallas that would use its own Membrane Solvent Extraction technology to strip and extract aluminum, cobalt, nickel, copper and other metals from electronic waste. The project picked up support in December when Freestone HoldCo, LLC, a subsidiary of Tailwater Capital LLC, agreed to lead a $20 million investment in Momentum Technologies. Subscribers can learn more from Industrial Info's project report.
Reviving Demand Rejuvenates Hard-Hit Facilities
Following a difficult 2020, in which the COVID-19 pandemic created widespread uncertainty across end markets, aluminum producers saw demand gradually improve throughout 2021. Container shortages and shipping delays--much of which is related to the ongoing supply-chain crunch--have hiked demand and prices for aluminum in the meantime. Global aluminum inventory has fallen to levels not seen since the end of the Great Recession--which, along with the global deficit, should keep aluminum prices elevated in the near term.
"On the demand side, we have seen consumption return to pre-COVID levels and expect the 2021 demand growth will be nearly 10% from 2020 levels," said Jesse Gary, the chief executive officer of Century Aluminum Company (NASDAQ:CENX) (Chicago, Illinois), in the company's most recent quarterly earnings-related conference call. "This growth comes despite headwinds in automotive and aerospace, given the semiconductor shortage and lower commercial airline travel, respectively. Recovery in these lagging sectors in 2022 would help drive continued demand growth in 2022 and beyond."
The revival in aluminum demand spurred Century Aluminum to reopen a potline at its Mount Holly Aluminum Smelter in Goose Creek, South Carolina, that had been closed since 2015. Phase I, which kicked off in January 2021, will increase overall plant capacity from 115,000 to 140,000 tons per year; upon completion, Phase II will begin and eventually bring nameplate capacity to 170,000 tons per year. Subscribers can read detailed project reports on Phase I and Phase II.
"In the U.S., demand [in third-quarter 2021] was up 12% from prior year, while supply was down 2%," said Peter Trpkovski, the head of investor relations at Century Aluminum, in the company's most recent quarterly conference call. "In Europe, demand was up approximately 16% from [third-quarter 2020] and supply growth was up only 3%. We continue to see these two markets as the shortest markets in the world, and that will carry into next year and beyond. As we saw last quarter, demand continues to outpace supply growth around the world, and the global aluminum market is now projected to be in a 1.5 million-ton deficit [for full-year] 2021."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
