AL Circle's weekly wrap
China to cancel aluminium export tax rebate from December 1, will this lead to trade negotiations with the US?
On Friday, November 15, China’s finance ministry declared its plan to reduce or cancel export tax concessions for a wide range of commodities, including aluminium. As per the report, the measure will be effective from December 1, 2024.
For certain products like refined oil, photovoltaics, batteries, and non-metallic items, China has decided to reduce tax rebates from 13 to 9 per cent, while for aluminium and copper products, the country will cancel the concession.
Following the news, aluminium prices soared in China as tax rebates would cover more than 5 million tonnes of metal exports worth RMB 17.7 billion. Analysts suspect that with this measure coming into effect, aluminium selling prices will increase further. Today, as of November 15, the metal price has already heightened by RMB 210 per tonne to RMB 20,850 per tonne.
Aluminium is a key material used in the manufacturing, construction, and automotive sectors, and China is the highest supplier of the metal worldwide. The limited possibility of capacity expansion for aluminium production in other countries, coupled with heavy demand, will lead China to shift tax costs to overseas buyers by increasing the metal prices.
In London, aluminium prices jumped more than 7 per cent at around 1200 GMT. This announcement also heightened the share prices of aluminium companies located outside China. For instance, Norsk Hydro shares rose 7.3 per cent in Oslo and Rio Tinto jumped 1.9 per cent in London.
This decision could also be seen as a strategic move in the background of trade tensions fuelled by Trump’s win in the US 2024 presidential election . It may even create room for trade negotiations with the United States.
5 worthwhile practices that can ensure green aluminium production in the near future
From smartphones to smart shoes, every gadget that we use daily is enhanced with aluminium. The demand for this versatile metal is skyrocketing, but so is its toll on the environment. The time for action is now.
The aluminium production industry is unified on decarbonisation. And the industry giants have taken baby steps towards the goal. According to the 2023 Aluminum Paradox report by the Environmental Integrity Project, global aluminium production resulted in 1.2 billion tonnes of global greenhouse gases in 2021. Now, the initiatives are to significantly reduce global greenhouse gas (GHG) emissions to keep the subsequent global warming under 2 °C (vs pre-industrial levels, i.e. the Beyond 2 Degrees Scenario, or B2DS). Whereas it should ideally be below 1.5 °C.
Innovative practices have not only shown potential but also inspired the global industry to believe in the possibility of achieving green aluminium production goals, instilling a sense of optimism in industry professionals, environmentalists, and policymakers.
Cutting-edge recycling approaches
Recycling scrap into aluminium consumes 95 per cent less energy than smelting primary aluminium from alumina. As the industry shifts towards carbon-neutral techniques, the potential of ultra-pure recycled aluminium manufacturing is a beacon of hope. It promises to improve the quality of aluminium suitable for usage in electric cars by eliminating impurities from recycled materials.
Implementation of artificial intelligence
With the use of corresponding machinery and sensors installed on fabrication units, coupled with cloud and edge computing, smart manufacturing AI eco-systems can be constructed. This mechanism will, in turn, not only send early warnings and enforce quality control but also optimise processes and perform predictive maintenance, ensuring the efficiency of future manufacturing. Read the full news here .
Closed loop recycling success: Capral and Rio Tinto partner on sustainable aluminium initiative
Australia's largest aluminium extruder, Capral, has successfully completed a trial using recycled-content billets supplied by Rio Tinto at Boyne Smelters Limited (BSL) in a significant stride towards sustainable manufacturing. This innovative process involved remelting 50 to 100 tonnes of post-production aluminium scrap sourced from Capral's Bremer Park extrusion plant in Southeast Queensland.
As a result, billets containing at least 20 per cent recycled content were produced, signalling a sustainable step forward in local aluminium manufacturing.
The trial highlights a closed-loop system that embodies waste minimisation and a marked reduction in the carbon footprint associated with aluminium extrusions. This initiative aligns seamlessly with the Australian Government's?Future Made in Australia?policy, reinforcing the country's commitment to sustainable industrial practices.
Notably, the entire value chain has remained within Australia. From the raw materials of bauxite and alumina to primary aluminium production, through Capral's extrusion process, and finally to Rio Tinto's innovative remelting of scrap – every step was carried out domestically. This achievement showcases Capral's dedication to environmental stewardship and marks a significant step forward for the Australian aluminium industry.
Capral is now considering integrating this sustainable billet into its broader product offerings, a move that could reshape local aluminium production standards and promote eco-friendly practices within the industry.
This successful trial at BSL demonstrates the potential for Australia to lead with closed-loop aluminium solutions, setting an example for sustainable manufacturing and contributing to a greener future. Read the full news here .
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