Increasing use of aluminium in US growing scrap availability; Recyclers to expand capacity

Significant growth in the use of aluminium in transport and packaging industries in the US has resulted in the increasing availability of aluminium scrap and thereby, encouraging recyclers to expand their capacity. Those who are already expanding include Novelis, Matalco, and JW Aluminium.

Novelis last month had announced its plan to invest $36 million to boost and upgrade recycling capacity at its Greensboro facility in the US. The project is expected to complete during the second half of 2021. Matalco is also planning a new $80 million aluminium recycling facility in Wisconsin, while JW Aluminium is expanding its facility in Goose Creek in South Carolina.

The increasing availability of aluminium scrap in the US has lowered the price, on the other hand. A proxy for auto scrap is the LME’s aluminum alloy contract CMNA3 which fell by more than half to $1,000 a tonne in October from above $2,000 in April 2018. The United States has an import duty on primary aluminium but not on scrap.

Jorge Vasquez, founder of consultancy Harbor Aluminium, also said, “Scrap prices are heavily discounted because availability has outpaced capacity and because tariffs exempt scrap.”

According to Harbor Aluminium, beverage can scrap prices are at nearly $900 a tonne, below the London Metal Exchange’s benchmark primary aluminium CMAL3 at around $1,760 a tonne. It calculates that in 2018, the US generated 5.9 million tonnes of aluminium scrap, up by about 20 per cent since 2016. Out of those 5.9 million tonnes, 5 million tonnes were recycled domestically, while the rest exported.

The demand and use of aluminium are estimated to grow further in drinks firms and electric vehicles manufacturers, resulting in the growth in generating scrap.

Aluminium Association showed aluminium use in passenger cars and light trucks climbed 23 per cent to 6,080 million lbs between 2007 and 2017, while the overall use of aluminium in transport rose nearly 20 per cent to 9,625 million lbs in the same period.

Total aluminum consumption in the United States this year is estimated to be more than 10 million tonnes, nearly 15% of the global total at 67 million tonnes.

Copyright and Exemption Declaration :¢ÙAll articles, pictures and videos that are marked with "China Aluminum Network" on this website are copyright and belong to China Aluminium Network (www.alu.com.cn). When transshipment, any media, website or individual must list the source from "China Aluminium Network (www.alu.com.cn)". We seek legal actions against anyone that disobey this. ¢ÚArticles that marked as copy from others are for transferring more information to readers, do not represent or endorse their opinions or accuracy and reliability. When other media, website or individuals copy from our website, must keep the source. Anyone that changes the articles' sources will hold the responsibilities for copyright and law problems. We also seek legal actions against anyone that disobey this. ¢ÛIf any articles copied by our website concern the copyright and other problems, please contact us within one week.