Difficult times ahead for aluminium players

Aluminium value chain voices call for EU and US scrap exports amid concerns over availability and high prices for primary metals.

The year is ending disappointingly for most metal recyclers in Europe. The global economy continues to be plagued by crises, coupled withincreasingly protectionist tendencies shown by major powers such as the USA and China.

The German Metal Traders Association (VDM) regularly conducts a business climate survey among its member companies. The latest results show that metal traders’ expectations regarding economic developments in the coming months remain subdued: 38% of the surveyed companies are pessimistic about the future. In contrast, only 10% expect an improvement in their business situation. Half of the respondents (52%) think the situation will improve.

Action calls

The European aluminium industry is suffering from US tariffs and cheap imports from China. Added to this are excessively high energy costs in Europe. Sales are weak, not least because the crucial automotive and construction industries are themselves in crisis. Industry is accepting less scrap metal, and many traders are already complaining about excessively high inventories at their yards.

The aluminium sectors in both the US and the EU are urging restrictions on exports of scrap. European Aluminium (EA) wants 30% duties on scrap sent from the EU while the US Aluminum Association (AA) is calling for export measures over used beverage containers (UBCs).

According to EA, aluminium scrap exports from the EU were at a record 1.26 million tonnes in 2024, around 50% higher than five years earlier, with most heading to Asia. EA’s director general Paul Voss told Reuters that European companies were finding it impossible to compete with buyers in Asia who can pay higher prices due to subsidies and lower labour and environmental standards.

According to the EA, approximately 40% (around five million tonnes) of the EU’s consumption of the metal comes from recycling. The current installed recycling furnace capacity in the EU stands at 12 million tonnes but around 15% is idled due to the lack of scrap availability.

White paper

Meanwhile, an AA white paper argues that restricting exports of UBCs is consistent with a global trend. The AA says China, India, Russia and Saudi Arabia already limit UBC scrap exports.
However, it wants export restrictions only on UBCs and similarly high-quality scrap, rather than lower-quality scrap streams such as Zorba and Twitch, until domestic processing improves. The AA white paper also calls for:

• updated US Harmonized Tariff Schedule (USHTS) codes and other tracking mechanisms to better monitor aluminium scrap flows
• investment in new technology to improve scrap collection and sorting
• potential expansion of export controls to other types of mill-ready scrap

Read the full market report in our upcoming issue >>