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Commodity Market Report 28 March 2022

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Report summary

The global aluminium strategic planning outlook provides a detailed forecast of aluminium supply and demand fundamentals out to 2050. The near to medium term outlook for the aluminium market will be shaped by the fallout from the Russia-Ukraine conflict. Although too early to fully assess, we are likely to see supply distress despite high prices and premia and elevated market risks. We think that there will be a reshaping of aluminium trade and supply-chain flows. The net result will be a volatile pricing environment. The long-term outlook will be shaped by decarbonisation with new capacity having to jump through ever rising hurdles. There is some comfort for investors as our calculations point to the average long-run price being comfortably above the inventive price. Nevertheless, the requirement for additional units of primary aluminium will fall as scrap based secondary metal increasingly does the heavy lifting in satisfying future demand requirement.

Aluminium long-term outlook
- Which countries are likely to host new aluminium capacity?
- The price to pay for carbon emissions
- Base case incentive price
- The long-term aluminium price
Alumina long-term outlook
Aluminium medium-term outlook
Alumina medium-term outlook
Bauxite market outlook
- Main risks around our base case aluminium market outlook
- Scenario analysis
- Summary
- Changes to consumption forecasts since Q4 2021
Forecasts by region
- China
- Asia ex-China
- Japan
- Europe
- North America
- United States
Smelter production and capacity
- Summary
Aluminium production changes since the last quarter
- Global smelter production and capacity 2021-2050
- Asia
- Asia ex-China
- China
- Europe
- Latin America and the Caribbean
- Middle East
- Africa
Refinery production and capacity
- Summary
Alumina production changes since the last quarter
- Global refinery production and capacity 2021-2050
- Asia
- China
- Indonesia
- Europe
- Latin America and the Caribbean
Bauxite production
- Africa
- Asia (excl. China)
- China
- Latin America and the Caribbean
- Oceania
Forecasting methodology
- Project Classification
- Supply disruptions
- Market-driven adjustment
Long term price, incentive price, risks and IRR methodology
- Incentive price
- Long term price
Assumptions used to construct incentive prices
Risks around the incentive price
Bauxite pricing

Tables and charts

This report includes 45 images and tables including:

Alumina incentive price, capital intensity and location
Alumina incentive price set at US$350/t (Constant 2022 $)
Average alumina prices, 1991-2040 and incentive price (US$/t)

Global aluminium balance and prices
Primary aluminium demand and capacity, 2010-2040, Mtpa
Stock days of consumption and price
Global supply-demand balance
Russia alumina production and imports
Stock days and price
Smelter grade alumina balance
Alumina demand and capacity, 2010-2040, Mtpa
Global alumina balance and prices
Global seaborne bauxite balance and prices
Seaborne supply and demand, Mt (dry)
Key bauxite ore routes freight forecasts
Main changes in aluminium production since the previous quarter
Main changes in alumina production since the previous quarter
Global metallurgical bauxite supply (Mt)
Global metallurgical bauxite requirement (Mt)
Required rates of return by country used in the calculations
Aluminium incentive price, capital intensity and location
Long term price forecast at US$3000/t (real 2022 $) – Incentive price US$2400
Average LME aluminium cash prices, 1991-2050 and long-term price (US$/t)
Base case and low price scenario balances and stock days of consumption
Base case and low price scenario prices (real 2022 US$/t)
Global primary aluminium consumption (Mt)
Changes to primary aluminium consumption since Q4 2021 (Mt)
Global primary aluminium consumption growth prospects wane beyond 2033
Global secondary consumption to grow by 3.5% p.a. to 2050
Main changes to primary aluminium consumption forecast Q2 2020 vs Q3 2020 (kt)
Secondary consumption to drive future total demand for aluminium
Total consumption by end-use sector
Non-residential construction growth set for 1.6% p.a. decline to 2040
Total consumption by end-use sector in Asia ex-China
Total consumption by end-use sector in Europe
Total consumption by end-use sector in US
Expected utilisation rate of Chinese aluminium smelters, 2019-2027 (Mt)
Regional aluminium smelter production capability – Mt
Potential projects in Southeast Asia
China’s smelter capacity change in 2022-2027, ktpa
Power contracts of select European smelters
Spain energy supply breakdown 2021
Regional alumina refinery production capability – Mt
Regional seaborne bauxite supply, 2000-2040 CAGR 2000-2019, 2020-2025. 2026-2040
Chinese imports of seaborne bauxite by province, 2021-2040