The Global Outlook for Primary Aluminium

Transcription

1 Includes quarterly price forecast updates throughout 2008! The Global Outlook for Primary Aluminium to 2018 Images Norsk Hydro Short-to-medium and long-term price forecast to 2018 Supply/demand balances by region to 2018 Consumption data and forecasts by region to 2018 Operating cost forecast for key markets Analysis of the effects of industry consolidation NEW for 2008 Tel: +44 (0)

2 A resilient aluminium market gives further support to those who believe in the theory of an extended cycle. From a fundamental perspective, the market tightness that prevailed during 2005 and 2006 started to ease as lower alumina prices encouraged primary aluminium production. Higher aluminium production in combination with a slowing North American economy helped to take the aluminium market back into surplus in Q However, it is far from certain that the current market surplus will depress the aluminium price. On the contrary, a steady growth in global aluminium demand has the potential of pushing the market back into tightness in the near future. Indeed, demand for primary aluminium has grown steadily since 2001 and accelerated over the last three years. Furthermore, the expectation of a prolonged strength in the aluminium market appears to be the main driving force behind the current wave of industry consolidation. All these issues and their potential effect on the aluminium market are analysed in this new report from Metal Bulletin Research (MBR): Chapter one focuses on primary aluminium consumption by region. Chapter two presents MBR s production forecast by region, by major companies, and lists the smelter projects accounted for in the outlook. Chapter three presents market balances by region and identifies future needs in aluminium capacity. Chapter four presents MBR s short-to-long term price forecast, which combines elements from the previous chapters with stock-toconsumption ratios, energy costs and exchange rates, among other variables, to derive MBR s base case price. Global aluminium production continues to grow Surge of China million tonnes Growth cycle after a period of stagnation and smelter cutback during the first half of the decade. Brownfield expansions dominate. Power related cutbacks Source: Metal Bulletin Research (MBR) A comprehensive long-term outlook market an essential tool for all tho

3 Metal Bulletin Research s primary aluminium outlook includes: A short-to-medium and long-term price forecast and likely range with 95% confidence level Analysis of the risks to the forecasts Long-term price forecast to 2018 Detailed supply/demand balances by region Estimates of aluminium consumption by region based on intensity of consumption and GDP/IP forecasts Identification of regions that have the potential to see further aluminium developments Estimates of investments needed over the forecast period in order to maintain the global aluminium market balance A view on the potential effects of industry consolidation Includes quarterly updates! Purchase this repor t and also receive quarterly updates in May (Q1), August (Q2) and November (Q3) 2008 of the shor t-to-medium and long-term price forecasts delivered in a Microsoft Powerpoint presentation format and by conference call from MBR s expert aluminium analysts. Who will benefit from this service? Executives at aluminium companies who make commercial decisions the market insights provide all the necessary information to those negotiating long-term aluminium supply/procurement agreements, and those designing the company s hedging strategy. Executives at aluminium companies who make investment decisions the long-term price forecast will assist in making the right decisions to those evaluating investment projects looking at new aluminium capacity (at any stage of the aluminium value chain), expansions, or plant upgrades. Consumers of aluminium those buying aluminium to add fur ther value through semi-fabrication or fabrication of aluminium products, will find the regional supply and demand balances contained in this report key for designing their business strategy. Analysts who need to gain a good understanding of the shor t-to-medium and long-term price drivers in the aluminium industry. Por tfolio managers who include aluminium as an asset class in their asset allocation. for the primary aluminium se involved in the industry

4 What s included? This unique service combines a shor t-to-medium and long-term forecast for primary aluminium in one annual report and also now includes three subsequent updates. Updates are delivered in a Microsoft Powerpoint presentation format and contain an update of the short-to-medium and long-term price forecast. PLUS delivery of updates are followed by a conference call where MBR s exper t analysts present key market updates and clients are given the oppor tunity to field questions about the aluminium industry directly relevant to them. Four consumption regions accounted for 90% of global aluminium consumption in % China 20% North America 22% Europe 16% Asia 4% Latin America 1% Africa 3% Middle East 1% Oceania Images Norsk Hydro 3% CIS Source: Metal Bulletin Research (MBR)

5 Contents Introduction Chapter 1 Consumption by region trends 1.1 Consumption drivers Intensity of use Substitution Use of scrap An overview of aluminium semi-fabricating and end use sectors 2.1. Aluminium semi fabricators sectors Flat rolling Extrusions Castings Forgings 2.2 Aluminium end use sectors Transport Automotives Passenger Cars Trucks Rail Aerospace Marine Construction Residential construction Commercial/Non-residential construction Bridges Packaging Global aluminium consumption Regional analysis 4.1 North America 4.2 Europe 4.3 Africa and Middle East 4.4 Asia and South East Asia 4.5 Latin America 4.6. Oceania 4.7. CIS 4.8. China Section 5 Global aluminium consumption Section 6 Summary Chapter 1 Chapter 2 Production by key markets 1.1 Production drivers Greenfield projects Brownfield expansions Capacity creep Raw materials markets and power Global aluminium production Regional analysis 3.1 North America North America - Expected changes in smelter Power situation in North America 3.2 Europe Europe - Expected changes in smelter Power situation in Europe 3.3 Asia Asia - Expected changes in smelter Power situation in Asia 3.4 Latin America Latin America - Expected changes in smelter Power situation in Latin America 3.5 Africa Africa - Expected changes in smelter Power situation in Africa 3.6 Middle East Middle East - Expected changes in smelter Power situation in the Middle East 3.7 Oceania Oceania - Expected changes in smelter Power situation in Oceania 3.8 CIS CIS - Expected changes in smelter Power situation in CIS 3.9 China China - Expected changes in smelter Power situation in China Global aluminium production forecast Section 5 Production by company (Industry concentration index) Section 6 Summary Chapter 2 Chapter 3 Global market balances Global balance for primary aluminium Regional balances 2.1 North America balance North America balance Europe Europe Asia Asia Latin America Latin America Africa Africa Middle East Middle East Oceania Oceania CIS CIS China China Global balance and investment required 3.1 Global balance for primary aluminium and power required Regions more likely to fill the capacity gap over the period Summary Chapter 3 Chapter 4 Key price forecasts and analysis Price drivers 1.1 Short-to-medium term price drivers Market balance Currency fluctuations Investment funds 1.2 Long-term price drivers Short-to-medium term price forecast 2.1 The model 2.2 Price forecast Stock-to-consumption ratio Rest of variables Short-to-medium term price forecast Risks to the forecast Aluminium capacity Aluminium consumption Energy Long-term price forecast 3.1 Price trends 3.2 Long run operating costs Raw materials price assumptions Operating cost forecast China Operating cost forecast CIS Operating cost forecast Europe Operating cost forecast Asia Operating cost forecast Latin America Operating cost forecast Middle East Operating cost forecast North America Operating cost forecast Oceania Operating cost forecast Africa Projected marginal smelting cost Price forecast Summary Chapter 4 Appendix Appendix A Historical aluminium prices Appendix B Aluminium consumption by country Appendix C Aluminium production by country Appendix D Macro economic indicators Appendix E Aluminium stocks Appendix F Smelter ownership and capacity 2008