Greece-based Industrial Group Head foresee key challenges for the bleeding Aluminum industry

Metal Recycling News  |  2013-03-14 03:30:09   |   By

The chairman of a Greece-based Industrial Group has predicted major challenges to Aluminum producers worldwide.

ATHENS (Scrap Monster) : The chairman of a Greece-based Industrial Group has predicted major challenges to Aluminum producers worldwide.

According to Evangelos Mytilineos, the chairman of Mytilineos Holdings SA, which owns Southeastern Europe's largest producer, Aluminum SA, the aluminum industry is already bleeding and the producers facing quite tough times.

The supply of aluminum has exceeded the demand. The demand for aluminum and other base metals has drastically reduced due to global economic slowdown and weaker industrial output. Ironically, the production of aluminum continues to remain stronger, especially in China. Surveys suggest that Chinese Aluminum production may grow by 10% in 2013 too.

Studies reveal that almost 35% aluminum producers in Asian region are operating on losses. The subsidies provided by the Government allow them to operate even at loss.

The surplus availability of products in market is sure to lead to further price contraction.

World's largest aluminum producer United Co. Rusal PLC has announced 7% cut in production owing to falling demand and plunging prices. Unless the industrial demand shows any major recovery, many other producers would be forced to cut their production.