Spring tidings

By Nick Wright

Demand is healthy for aluminum in many sectors as The Aluminum Association affirms metal’s sustainability

May 2012 - In April, The Aluminum Association convened in Napa, Calif., for its spring meeting to address issues affecting the metal’s usage, markets and sustainability. Despite the monthly reports of fluctuating global supply and demand, both the long- and short-term sentiments for aluminum point to positive growth, as indicated by comments during the association’s press roundtable.

Transportation is shaping up to be an exciting market. Tom Brackmann, president of Nichols Aluminum, Davenport, Iowa, and chairman of the Aluminum Association’s board of directors, expects the amount of aluminum in automotive applications to double by 2020. As the steel industry develops ultra-high-strength steels for cars, aluminum suppliers are advancing their materials—driven in part by looming CAFE deadlines. Aluminum’s light weight is a major way for car companies to reach those deadlines, Brackmann says.

The Census Bureau reported transportation equipment had the largest increase for new manufactured durable goods at $2.2 billion or 3.9 percent to $57.9 billion from January to February. This, too, could be a harbinger for aluminum’s further growth in automotive applications.

The current penetration aluminum has made into automotive applications is mainly in powertrain and engine components. “But the big opportunity is in the body sheet, and that’s the place aluminum is expected grow through this time period,” Brackmann says. He expects sheet and flat-rolled products to account for aluminum’s doubled usage in automobiles.

As the year progresses, the association anticipates the construction and housing sectors to improve. Brackmann says while aluminum sheet shipments for building and construction were down about 5 percent in 2011, there is “cautious optimism” that 2012 will be stronger. He notes housing starts are up for the first two months of the year, which is a good sign. Hopefully, the uptick is not just a reflection of the mild winter.

“Aluminum in particular is still a very important aspect of housing, whether in multifamily or single family or new homes,” he says. As housing picks up, construction of schools and commercial buildings will follow. In the extrusion market, “commercial windows are still dominated by aluminum.”

Aerospace, while a smaller percentage of aluminum’s total demand, is representative of technological advances in the material. For example, Boeing said recently it is working on the 737 MAX to replace its aging 737 fleet, which will source mostly aluminum, says Brackmann.

“That’s a big deal because that sets aluminum up for the next good period of time while this plane is developed and produced, and it keeps composites at bay,” he says.

Association’s activity
It’s common knowledge that recyclability is one of aluminum’s inextricable qualities and perhaps the most important. As it is, The Aluminum Association is improving its position on sustainability. About 75 percent of all aluminum ever produced is still in use, says Heidi Brock, president of The Aluminum Association. Getting the message out is one of the group’s main strategic goals. That goes hand in hand with deepening its value proposition for member companies and establishing policies.

“We do what we need to do to for our members to support them, to help them do whatever makes sense for them in their individual businesses to improve that position,” Brock says. The association also is embracing social media as one way to bolster its value for members.

The group is translating some of those bigger efforts into bolstering its curbside partnerships to educate the public on recycling’s benefits. Stephen Gardner, vice president of communications at the Aluminum Association, says during the recession, many recycling programs took a financial hit, which limited the information accessible to the public. When communities don’t know where to get a bin or what day to put it out, recycling isn’t as effective as it could be.

“There is a new energy and a new enthusiasm around finding a solution to this,” he says. Material industries, not just aluminum, would love to get more material back.

Construction industries are reliable recyclers because they’re more aware of material value, Brackmann says. Because aluminum cans are single-use and convenient, they’re easy for people to simply throw out. But as more cans are recycled, there is energy savings to gain, Brock adds.

“It’s huge, in dollars and energy, that could be saved,” Brackmann says. MM

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2016 End User Outlook

Although low pricing on metal products across the globe once inspired companies to stock up, there’s little appetite for risk peering into 2016.


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