ALUMINA LIMITED BELIEVES THAT THE OUTLOOK FOR THE ALUMINUM MARKET WILL BE OPTIMAL IN THE MEDIUM TERM.

Australia’s Alumina Limited believes that the “medium-term outlook” is currently the best for the aluminum market. The multinational, which owns a 40% non-operating stake in Alcoa World Alumina Chemicals’, is aiming higher at the moment, with demand for alumina growing and aluminum prices rising despite the supply disruption.

According to Alumina’s CEO, Mike Ferraro, “Russia’s metallurgical industry giant, Rusal, is being trampled by European sanctions and Australian bans; moreover, the closure of its only Ukrainian refinery, Nikolaev, is hitting the company hard.

In addition, the Covid-19 problems, production delays and Chinese environmental measures have jointly contributed to the rise in aluminum prices” and adds that “the market price of alumina reached above $530 per tonne in March 2022 and averaged $498 per tonne in that month. Currently, the API stands at $371 per tonne, still well above the average price of $329 per tonne in 2021.”

“The medium-term outlook for the alumina market is strong. Over the next five years, the projected and potential increase in primary aluminum production is 5.9 million tons per year outside of China, due to industrial growth and decarbonization of the world. This would require about 11 million tons per year of additional alumina. Currently, there are only 3 million tons per year committed outside China,” the expert stresses.

Finally, Ferraro adds that “China will take a long time to add new capacity outside the Middle Kingdom, as it only exports at high prices. This spring practice may eventually lead to regional supply shortfalls. The global energy transition and growth in aluminum metal consumption driven by decarbonization are positive for the alumina industry.”