Aluminium has been the worst performer among base metals in 2009 and investors will never forget the setback they suffered by putting their money in aluminium in the previous year. But, there is no guarantee that the scenario will remain the same in 2010.
But, like any other base metal, China holds the key to the aluminium prices. If Chinese demand soars the prices will climb up and India’s aluminium producers are set to cash in on that.
Long term prospect of aluminium is bright as China is still in the middle of completing urbanization and its metal intensive growth is likely to continue for many years to come.
About 65% of aluminium consumption is in the east and middle south China. The urbanization of North West and south west has great potential for aluminium demand in the coming years.
In the short term, overcapacity, plenty of inventories and reopening of smelters due to return to profitability will cap any upswing in aluminium prices.
However, the current average cost of the Chinese smelters is $2,000 and is rising further due to increase in bauxite and alumina and coal and power prices. These cost push factors provide a strong floor for aluminium prices.
LME aluminium is expected to trade between $2,000 to $2,400 in 2010.
Indian aluminium producers are best placed with captive bauxite, alumina, power and are insulated from across the board cost increases to a large extent.
In the pure aluminium space, the top company will be India’s Nalco. It is one of the cheapest aluminium producers and has volume upside of 30% in both aluminium and alumina due to brown field expansion.
Aluminum has been the worst performer among the base metals this year with returns close to 47% only.
Enam, a leading brokerage and research house has come out with its latest report on China’s aluminium sector and its outlook saying that aluminium demand in China is expected to grow by 15% in 2010 on the back of revival in construction and auto segments.
Showing posts with label Aluminium. Show all posts
Showing posts with label Aluminium. Show all posts
Saturday, 2 January 2010
Wednesday, 7 October 2009
Rising aluminium recycling and climate change
Bauxite makes up 8% of the earth’s crust, it is the third most abundant element in nature. The ore from which aluminum is produced is bauxite. More than 130 million tons of bauxite are mined each year. It has been estimated that we have enough aluminum to last us 400 years.
Bauxite has to be processed into pure aluminum oxide (alumina) before it can be converted to aluminum by electrolysis. Four tons of bauxite are required to produce two tons of alumina which in turn produces one ton of aluminum at the primary smelter.
Smelting is one of the most destructive processes to our climate. Fabrication encompasses several industrial processes: rolling, casting and extrusion.
Aluminum is then formed into products. The major outlets for aluminum products are in transport, building and construction, packaging and engineering. The real impact on the environment, its carbon footprint or greenhouse gas emissions, can only be judged from the life cycle perspective. What we're interested in here is the lifecycle of one aluminum can.
Once our can is used, we certainly hope it is recycled. Recycling is a major consideration in continued aluminum use, representing one of its key attributes. More than half of all the aluminum currently produced originates from recycled raw materials, a trend that is on the rise. In view of energy constraints, we have a huge stake in the collection of available aluminum and developing the most efficient scrap treatments and melting processes.
Aluminum can be recycled over and over again without loss of properties. Aluminum recycling benefits present and future generations by conserving energy and other natural resources.
Recycling just one soda can saves enough electricity to run a laptop computer for over 10 hours.
Recycling saves up to 95% of the energy required for primary aluminum production which avoids greenhouse gas emissions used in the process. Increasing demand for aluminum and the long lifetime of many products mean that, for the foreseeable future, the overall amount of primary metal produced from bauxite will continue to be greater than the volume of available recycled metal.
The life cycle of an aluminum can from mining to recycling is 60 days. Think of how many beverage and food cans you use during the next 60 days.
Global aluminum recycling rates are high, approximately 90% for transport and construction applications and about 60% for cans. In 2004, the United States only recycled 45% of cans.
I think we can do better than 45%, after all, it's something we all can do. (Courtesy: PRLog)
Bauxite has to be processed into pure aluminum oxide (alumina) before it can be converted to aluminum by electrolysis. Four tons of bauxite are required to produce two tons of alumina which in turn produces one ton of aluminum at the primary smelter.
Smelting is one of the most destructive processes to our climate. Fabrication encompasses several industrial processes: rolling, casting and extrusion.
Aluminum is then formed into products. The major outlets for aluminum products are in transport, building and construction, packaging and engineering. The real impact on the environment, its carbon footprint or greenhouse gas emissions, can only be judged from the life cycle perspective. What we're interested in here is the lifecycle of one aluminum can.
Once our can is used, we certainly hope it is recycled. Recycling is a major consideration in continued aluminum use, representing one of its key attributes. More than half of all the aluminum currently produced originates from recycled raw materials, a trend that is on the rise. In view of energy constraints, we have a huge stake in the collection of available aluminum and developing the most efficient scrap treatments and melting processes.
Aluminum can be recycled over and over again without loss of properties. Aluminum recycling benefits present and future generations by conserving energy and other natural resources.
Recycling just one soda can saves enough electricity to run a laptop computer for over 10 hours.
Recycling saves up to 95% of the energy required for primary aluminum production which avoids greenhouse gas emissions used in the process. Increasing demand for aluminum and the long lifetime of many products mean that, for the foreseeable future, the overall amount of primary metal produced from bauxite will continue to be greater than the volume of available recycled metal.
The life cycle of an aluminum can from mining to recycling is 60 days. Think of how many beverage and food cans you use during the next 60 days.
Global aluminum recycling rates are high, approximately 90% for transport and construction applications and about 60% for cans. In 2004, the United States only recycled 45% of cans.
I think we can do better than 45%, after all, it's something we all can do. (Courtesy: PRLog)
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