Record aluminium scrap exports to Asia seen

Print this page Posted on : 11-29-2007 by recycleinme.com

North America will probably export more than a third of its aluminium scrap to Asia this year, a record, as the weak dollar makes the metal cheaper for buyers abroad, according to recycler Aleris International Inc.

Shipments are also rising because of “very low” freight rates from the Pacific North-west to Asia, Mr. Roland Scharf-Bergman, Managing Director of unit Aleris Recycling said in Munich, Germany on Wednesday. He manages the company’s European recycling.

“This is pretty bad for the North American industry,” he said at the 15th Metal Bulletin Recycled Aluminium conference. Aleris, the biggest recycler of the metal in North America, is seeking supply from South America including Brazil, he said.

OVERCAPACITY

North American “overcapacity” is triggering mergers and acquisitions in the recycling industry, Mr. Scharf-Bergmann said. The region generates about £ 6 billion of aluminium scrap a year, mostly from vehicles and beverage cans.

Aleris, founded in December 2004, has expanded through acquisitions in the Americas, Europe and Asia.

ALUMINIUM SHORTAGE

Meanwhile, Trimet Group, Germany’s largest aluminium producer, said increased energy and freight costs and rising demand will lead to a shortage of the metal in 2010.

The cost of building a tonne of smelting capacity will reach $7,200 in 2009, more than double the level in the 1980s, Mr. Thomas Reuther, Managing Director for recycling at Essen-based Trimet, said today at a conference in Munich. Energy makes up as much as 40 per cent of the output cost of aluminium, Mr. Reuther said.

“A further increase of aluminium consumption will lead to a shortage in 2010,” he said, based on annual demand growth of 6 per cent. Mr. Reuther didn’t give projections for prices.

PRICES MAY INCREASE

Aluminium for three-month delivery has dropped 10 per cent on the London Metal Exchange this year at a time when metals such as lead and tin have gained.

The contract expiring February 2010 rose 9 per cent in the same period, touching a record $2,745 a tonne November 9 and suggesting prices will increase in the future.

The world had a surplus of 320,000 tonnes in the first nine months, according to Ware, England-based World Bureau of Metal Statistics, depressing prices.

China, the largest aluminium producer, will import more than it exports by about 2009, Mr. Reuther said in an interview today.

Source : Business Line