Aluminum Production
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 323 aluminum processors in the US produce aluminum and aluminum alloys from bauxite and aluminum scrap. Products include aluminum ingots, slabs, sheets, plates, foils, bars, and extruded shapes. Primary production is when alumina (aluminum oxide) is smelted to create pure aluminum metal. Secondary production is the smelting of recycled aluminum scrap to create aluminum that can be used again.
Volatile Product Prices
Aluminum prices vary with global supply and demand and can be volatile.
Energy Intensive
Aluminum production consumes high amounts of electricity, natural gas, and fuel oil.
Industry size & Structure
The average aluminum producer employs about 177 workers and generates about $128.5 million annually.
- The aluminum production industry consists of about 323 companies that employ 57,300 workers and generate $41.5 billion annually.
- The 21 primary aluminum producers in the US are dominated by two companies, Alcoa and Century Aluminum.
- There are about 60 secondary aluminum production facilities in the US.
- About 50 companies produce aluminum products, such as sheets, plates, bars, foils, and extruded shapes.
Industry Forecast
Aluminum Production Industry Growth
Recent Developments
Jul 18, 2024 - Labor Costs Rising Amid Falling Prices
- According to the latest US Bureau of Labor Statistics data, producer prices for aluminum declined by 1.2% in May compared to a year ago after tumbling 15% in the previous annual comparison. Industry employment inched up 0.8% in May year over year, while average wages at primary metals manufacturers rose 5.5% in June to a new high of $29.41 per hour, BLS data shows. Following a sharp decline in 2023, the global price of aluminum is forecast to rise 2% in 2024 and 4% in 2025, according to the World Bank.
- The trade association for US aluminum producers applauded the Biden administration’s action to stop China from avoiding import taxes by routing steel and aluminum through Mexico. According to the Aluminum Association, under an agreement between the US and Mexico reached in July, aluminum products smelted and cast in Belarus, China, Iran, and Russia will no longer be permitted to enter the US under the Section 232 exemption that Mexico enjoys as part of the US-Mexico-Canada Agreement. Aluminum imports to the US through Mexico will be subject to a 10% tariff if they contain metal smelted or cast in China, Belarus, Iran, or Russia. According to recent Aluminum Association data, aluminum demand in North America was up 4.3% year-over-year in the first quarter of 2024—the strongest results since 2022.
- The closure of one of the US’s last primary aluminum smelters in late January is sparking fears of an aluminum shortage in the US, Steel News reports. The shutdown of the Magnitude 7 Metals plant in Missouri, which was capable of supplying up to 30% of the nation’s aluminum needs, was the third closure of a US aluminum plant in less than two years, leaving the US with just four. The surprise closure threatens the US’s clean energy transition because aluminum is used in everything from airplanes and cars to solar panels and electric transmission lines. The Mag 7 plant closure highlights one of the major challenges facing the aluminum industry: high electricity costs, as smelting requires near-constant electricity at high volumes. Appeals have been made to the Biden administration to restart the plant as a matter of national security.
- Legislation pending in Congress would hold aluminum producers accountable for charging a tariffed price on non-tariffed metal, according to a press release from the office of its sponsor, Rep. Ken Buck of Colorado. The False Claims Enhancement Act (H.R. 7078) clarifies that it is a violation of the False Claims Act for a party – such as an aluminum producer – to falsely charge a tariff in a private contract where no tariff is owed and the proceeds are not paid to the government. The bill is supported by the beer industry – a major consumer of aluminum – which says it would provide much-needed transparency in aluminum pricing. “Aluminum is the single largest commodity cost across the beer industry, making it imperative to have fair and open price discovery processes for buyers and sellers alike,” Molson Coors President and CEO Gavin Hattersley said in a statement.
Get A Demo
Vertical IQ’s Industry Intelligence Platform
See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.
Build valuable, lasting relationships by having smarter conversations -
check out Vertical IQ today.