Aluminum Market Set to Soar: Anticipates 5.9% CAGR Growth Until 2030!

According to a research report by Next Move Strategy Consulting, the global Aluminum Market?size was valued at USD 179.22 billion in 2022, and is expected to reach USD 302.38 billion by 2030, with a CAGR of 5.9% from 2023 to 2030.

The automotive industry is playing a crucial role in driving the growth of the aluminium market. One of the primary reasons for this is that aluminium possesses a high strength-to-weight ratio, which makes it an excellent choice for producing various automotive components, such as body panels, chassis, and engine parts. As a result, the demand for aluminium in the automotive sector is steadily increasing.

According to the U.S. Aluminum Association, there is a continuous upward trend in the amount of aluminium used per vehicle. It is projected to be a net gain of 56 pounds per vehicle between 2020 and 2025. Furthermore, the use of aluminium is expected to grow by nearly 100 net Purchase Price Variance (PPV) between 2020 and 2030, reaching a total of 550 PPV. These statistics highlight the significant and sustained growth in the adoption of aluminium by the automotive industry.

By incorporating aluminium into their vehicles, automakers can achieve substantial weight reduction. This weight reduction has several benefits, including improved fuel economy and reduced emissions. Lightweight vehicles require less energy to propel, leading to increased fuel efficiency. Additionally, lower vehicle weight contributes to a decrease in carbon dioxide emissions, promoting environmental sustainability.

Moreover, recycling aluminium offers numerous advantages, including energy savings, resource conservation, and reduced environmental impact. The industry can significantly reduce energy consumption by recycling aluminium as compared to primary aluminium production, leading to cost savings and lower carbon emissions. According to the International Aluminum Institute, the total amount of recycled aluminium scrap contributes to more than 30 million tons globally every year, which is why it is considered one of the most recycled materials on the planet. Additionally, recycling aluminium helps conserve natural resources by minimizing the need for extracting and refining new raw materials. The recyclability of aluminium allows it to be reused multiple times without significant loss of quality, making it a sustainable material for various industries, such as automotive, construction, packaging, and consumer goods. These factors drive the growth of the aluminium market.

However, the environmental and regulatory constraints, which can increase operational costs, restrain the growth of the market. These constraints can pose a barrier for smaller businesses or organizations with limited budgets and act as a barrier to the market growth. On the contrary, the surge in the adoption of sustainable packaging in cans, bottles, and foils is expected to create ample opportunities in the aluminium market.

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The report offers an extensive segmentation of the global aluminium market based on product type, type, end-user industry, and geography. Based on product type, the market is classified into flat-rolled, casting, extrusions, forgings, powder & paste, and other types.

On the basis of type, the market is bifurcated into primary and secondary. Based on end-user industry, the market is categorized into transport, consumer goods, machinery & equipment, construction, foil & packaging, electrical engineering, and others. Region-wise, the report analyses the global aluminium market across North America, Europe, Asia-Pacific, and rest of the world (RoW).

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The report states that Asia-Pacific holds the largest share of the aluminium market, owing to the expanding aviation industry in countries such as China. This sector generates a significant demand for aluminium, which, in turn, accelerates the market growth. According to the International Trade Administration, The Civil Aviation Administration of China’s (CAAC) records show that China had 248 transport airports by the end of 2021, with seven new airports in operation at Jinzhou Airport in Hubei, Jiujiang Airport in Jiangxi, Heze Airport in Shandong, Wuhu Airport in Anhui, Chengdu Tianfu Airport in Sichuan, Binzhou Airport in Hunan, and Shaoguan Airport in Guangdong.

Furthermore, the rising construction and infrastructure sectors in developing economies such as India and Indonesia are significantly fuelling the growth of the market. The construction of commercial complexes, residential buildings, and infrastructure projects, including roads, bridges, and airports, drives the demand for aluminium in various applications. These applications include window frames, roofing, cladding, and structural components. According to the Organization for Economic Cooperation and Development, almost 400 infrastructure investment projects in transport, energy, water, and information and communication technology (ICT) infrastructure will be completed in Indonesia by 2025.

On the other hand, North America is expected to witness an increased demand for aluminium in the coming years, due to the region's shift towards the sources of renewable energy and the advent of electric vehicles (EVs).

Aluminium is extensively used in renewable energy infrastructure, such as solar panels, wind turbines, and transmission lines. The increase in utilization of solar energy in the U.S. further boosts the market growth. According to the Solar Energy industries association, the residential solar power installations in the U.S. increased by nearly 34%, with installations raising from 2.9 gigawatts in 2020 to 3.9 gigawatts in 2021.

Furthermore, the region maintains strong trade relationships and export opportunities for aluminium products. Countries such as Canada have access to the global markets, including the U.S., Europe, and Asia. In these regions, Canadian aluminium products have a high demand. According to the International Trade Administration, Canada exported around 31 million metric tons of aluminium in 2022, demonstrating its significant presence in the global aluminium market. Trade agreements and favorable export policies facilitate the export of aluminium, contributing to the growth and expansion of the aluminium market in the country.

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The report offers an extensive analysis of the competitive landscape of the aluminium market. Some of the major players in the market include Aluminum Corporation of China Limited (CHALCO), Hindalco Industries Ltd., Norsk Hydro ASA, China Hongqiao Group Limited, United Company RUSAL PLC, Rio Tinto, East Hope Group Company Limited, Xinfa Group Co., Ltd., Alcoa Corporation, and Arconic, Inc.

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