Aluminium stockists battle production surges, coal fired steel in Japan
China’s aluminium smelters resurge while Europe’s fall back
China produced a record-breaking 3.42 million tonnes of primary aluminium in May 2022. It’s a clear sign the country is still ramping up its run-rates. The first five months of the year saw China’s annual production increase by a whopping 3.66 million tonnes, with May hitting the highest ever operating rate of 40.27 million tonnes.
It’s all down to the easing of power prices in China while, at the same time, the European power crisis is still unfolding thanks to Russia’s war on Ukraine. So far this year, energy issues have forced production outside China down by 460,000 tonnes .
Deep joy for petrol heads
It has just debuted at Goodwood at the Festival of Speed. The launch is planned for 2024. And it’s a beast of a machine. Meet the awesome Polestar 5. It’s an all-electric four door grand tourer of a vehicle with an extraordinary lightweight bonded aluminium chassis. Add the vehicle’s 872bhp powertrain and you can see why the Swedish brand’s latest performance car is causing such a stir.
It’s one of three new models being rolled out by the company, which is an offshoot of Volvo. The new models represent a dramatic change in terms of engineering thanks to the new bonded aluminium vehicle architecture.
The targets for the Polestar 5? They’re aiming for power of 650kW (872bhp) and 664 lb ft torque. And that means it’ll easily be more powerful than a Ferrari 296 GTB plug-in hybrid supercar, whose total system output is a ‘mere’ 818bhp.
If you’re ever lucky enough to get to get behind the wheel you can expect a thrilling four-wheel drive experience delivered by a new electric motor that runs the back wheels, plus another motor fixed to the front axle. The planned 800v electrical system will provide high-speed power delivery and super-fast recharging.
The European aluminium value chain takes an energy body-blow
As reported by Euractiv (https://www.euractiv.com/section/energy), the crucial European aluminium value chain is an ‘essential enabler’ of the entire continent’s goal of climate neutrality and strategic autonomy. Experts reckon 2030 will see at least 18Mt of aluminium needed to ‘green’ the energy network. But the energy crisis and related uncertainty is putting the mockers on progress.
The cost of power accounts for around 40% of the cost of European primary aluminium production. Since summer 2021 prices have shot up by an unbelievable 400% thanks to economic, regulatory, and geopolitical issues. Right now 50% of Europe’s aluminium smelters are either reducing their output or stopping production. If action isn’t taken, this will continue to hit the value chain hard. How will they continue to support the region’s green energy transition? It’s getting ever-more complicated. Watch this space.
Emirates Global Aluminium on a roll
Emirates Global Aluminium is the biggest industrial business in the UAE outside oil and gas. They ship the metal to more than 50 countries across the globe. Now it’s planning to double its contribution to the UAE economy by 2040.
One way the company is planning to achieve their goal is boosting local procurement. They already spend $1.6 billion annually in the UAE supply chain. The ultimate aim is to empower industrial growth in the UAE, contribute to economic development, and increase supply chain resilience.
The price of iron ore plummets
Prices rise, prices fall. It’s a feature of our sector. On Wednesday 22nd June the price of iron ore dropped to the lowest level since week 1 December 2021, over serious concerns about an oversupply of steel in China. Markets are particularly concerned over demand growth expectations. They feel China’s pledge to boost infrastructure investment may not happen, partly because the country’s zero-covid policy is so damaging.
Heavy rain in some parts of China has also caused havoc. Steel inventories have been piling up and steel mills are switching off their blast furnaces to minimise losses. All of this means markets can’t afford to ignore Chinese steel over-supply any longer.
Nippon Steel Corp takes a backward step into coal
Japan’s steel giant Nippon Steel Corp is considering investing more in coal mines after an energy price surge. International prices of the coking coal used to make the alloy have increased to ‘unprecedented levels’ because of the Ukraine war. At the same time, Japan’s steel mills, which rely quite heavily on imports, are fighting dramatic cost rises as the Yen falls in value.
We’re keeping calm, and carrying on!
Up, down, up, down… our aluminium bar suppliers, steel suppliers and metal supply world has always been a place of dramatic change. Luckily we’ve been selling metals for so long we’re used to the drama. Whatever you need we’ll supply it for you, cheerfully and professionally, at the best price we can possibly offer at the time. Plus great service and all the advice you could need.
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