Shortage of aluminum to be transformed for the restart of the aluminum industry

The light metal is in short supply throughout Europe and prices are at the highest levels in recent years.

Due to this scarcity, an in-depth analysis was conducted on the situation of the European aluminum market, characterized by a sharp increase in demand and the difficulty of finding metal. This is causing a significant expansion of delivery terms and is significantly affecting the trend in metal prices, with LME prices and premiums on billets and foundry blocks at the highest levels in recent years. A situation that took the entire downstream processing sector by surprise.

The causes of the shortage of aluminum to be transformed and the new perspectives of the post-pandemic aluminum industry

The market is very hot these days and it is difficult to fully understand why everyone is looking for billets today. Operators are almost in panic also due to the high value of the premiums on billets and the apparent scarcity of quality aluminum to be processed. The current situation is partly related to the restart of production after the 'break' imposed by the Covid-19 pandemic. In fact, many companies had significantly reduced their stocks and found themselves unprepared for the price rebounds caused by the surge in commodity prices. The stop on imports of semi-finished products from China was then added. From one day to the next, more than 500,000 tons of Chinese semi-finished products, including extrusions and rolled products, have gone missing. In addition, state incentives in various countries have given new breath to strategic sectors such as building or solar. Another factor to consider is the restart of the automotive sector, driving the consumption of aluminum, with the enormous pressure towards the production of electric cars, known for the greater use of light metal compared to combustion engines. We do not know how long this unexpected situation will last. The delivery terms have been extended. There is a perception among downstream companies that there is not enough aluminum on the market. Especially in Italy, where all processing companies are persistently looking for metal.

Source: A&L Aluminium Alloys Pressure Diecasting Foundry Tecniques