Weekly Metals News Digest (December 4-8)

Exports of the winged metal from China are on the rise

China presented another surprise to the global market, having exported almost 490 thousand tons of aluminum by the end of November this year. For comparison, in October 440.258 thousand tons of the winged metal were shipped outside the former Celestial Empire.

At the same time, in the eleven months of 2023, aluminum exports from China decreased by 15.3% to 5.19 million tons.

Such a paradox can be explained by the growth of aluminum production in China, which is confirmed by the statistical information of the International Aluminium Institute.According to them, China produced 3.46 million tons of aluminum in October 2022 and 3.65 million tons in October 2023.

The data for November 2023 International Aluminium Institute has not yet been published, but we can predict that they will show an increase in aluminum production.

However, for the world market, the expansion of exports from China is not very pleasant, because it may lead to a decline in aluminum prices, which are now at $2,134 thousand dollars per ton – the lowest since March 2022.

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Changes are coming to the platinum and palladium markets

Nornickel has published a new review of the global market for base and precious metals produced by its operations in Russia.

According to the review, the previously expected palladium deficit of 0.2 million troy ounces was revised upward to 0.9 million troy ounces for the current year. This is due to the decline in palladium production in North America. In 2024, the palladium deficit is forecast at 0.4 million troy ounces due to the growth of metal output from scrap and waste.

At the same time, the global platinum market will move from balance to a metal shortage of 0.4 million troy ounces. The reason for this is the problems with power supply in South Africa, which lead to disruptions in power supply to local mines and smelters and, as a result, to a drop in platinum production.

On the contrary, the global copper market will remain balanced both in 2023 and next year, on the one hand due to the growth in global copper consumption, and on the other hand due to the increase in ore mining and smelting of the red metal.

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A new aluminum smelter has been commissioned in the USA

One of the largest European aluminum producers Norsk Hydro Corporation has launched a new plant in the U.S. state of Michigan for the production of secondary aluminum alloys.

The plant is located in the Cassopolis technology park, with capital investments in its construction amounting to 150 million dollars. The plant will produce about 120 thousand tons of secondary aluminum alloys per year under the brand name Circal.

According to Norsk Hydro’s plans, the new plant should begin shipping products in the first quarter of next year, reaching design capacity in the fourth. Supplies of aluminum alloys will first be made to manufacturers of profiles (components for the manufacture of windows, doors, office partitions, etc.), in the future it is planned to develop their sales for the needs of plants for the production of electric cars.

Currently, Norsk Hydro has 11 facilities for melting scrap into secondary aluminum alloys. Their total capacity is almost 900 thousand tons per year.

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Spain will return to the nickel market

The only existing nickel mine in Spain (and at the same time one of the last in Europe) Aguablanca has found a new investor: 50% of the shares of the company owning it Río Narcea Recursos acquired by the Canadian corporation Denarius Metal, paying for them 25 million euros.

The Aguablanca deposit was discovered in 1994, and nine years later mining of ores containing nickel and copper began. In 2007, Río Narcea Recursos, which owns Aguablanca, was acquired by Sweden’s Lundin Mining.

Aguablanca continued to operate until 2015, after which it was shut down amid a decline in global base metal prices. During its operation it produced almost 1 million tons of concentrate containing 66,552 thousand tons of nickel and 59,236 thousand tons of copper.

Now it is planned to restart Aguablanca next summer: the exploration work carried out under its open pit has revealed significant nickel reserves that can be developed at the current price level. About 350 new jobs are expected to be created.

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Rusal and Chalco develop secret cooperation

Top managers of the two global aluminum companies held a business meeting: Vice General Manager of Chalco Dong Jianxiong discussed with Deputy Chief Executive Officer of Rusal Oleg Mukhamedshin the issues of strengthening cooperation. In particular, Chalco is ready to implement projects with Rusal on the use of red sludge – waste from the processing of bauxite into alumina.

However, the details of the negotiations between Oleg Mukhamedshin and Dong Jianxiong remained unchanged. Nevertheless, it is worth recalling that back in March 2013, Chalco and Rusal signed a memorandum of cooperation concerning, among other things, the development of bauxite deposits and primary aluminum production.

In September 2014, Oleg Mukhamedshin said that Rusal is studying the prospects of implementing a project in Eastern Siberia together with Chalco. According to him, the possible joint project with Chalco will be tied to rich mineral deposits, hydropower potential and the proximity of Eastern Siberia to China.

Therefore, it is possible that the meeting between Oleg Mukhamedshin and Dong Jianxiong was also about a joint project.

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Forecast: primary aluminum production in the U.S. is heading for the sunset

Norsk Hydro’s opening of a new secondary aluminum alloy smelter in the U.S. directly reflects trends in the U.S. non-ferrous metals industry: if 20 years ago U.S. smelters produced about 3 tons of primary aluminum per year, last year they produced only 860 thousand tons, and by the end of 2023 we can expect a decline in production to 700-750 thousand tons.

But the smelting of secondary aluminum, which in the U.S. two decades ago was no more than 1.2 million tons per year, in 2022 reached 3.4 million tons. In total, the output of secondary aluminum alloys by U.S. smelters may reach 3.6 million tons this year.

This situation is due to two factors: the year-on-year increase in prices for electricity required for the electrolysis of primary aluminum, and its imports from China and Canada. As a consequence, U.S. primary aluminum smelters are gradually phasing out production and this process may continue in 2024. icon

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