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Incentive prices: alumina to aluminium price ratio to rise?


Incentive prices: alumina to aluminium price ratio to rise?

Report summary

Wood Mackenzie's analysis of long run incentive prices for alumina and aluminium suggests that prices will need to be higher in the future than historically observed, if the market is to remain in equilibrium.

What's included?

This report includes 1 file(s)

  • Incentive prices: alumina to aluminium price ratio to rise? PDF - 523.01 KB 6 Pages, 2 Tables, 6 Figures

Description

This Metals Insight report highlights the key issues surrounding this topic, and draws out the implications for those involved.

For industry participants and advisors who want to look at the trends, risks and issues surrounding this topic, this report gives you an expert point of view to help inform your decision making.

Our analysts are based in the markets they analyse and work with high-quality proprietary data to provide consistent and reliable insight.

We provide unique in-depth analysis of the metals supply industry so you can make confident strategic decisions.

  • IRR methodology- the rationale and risks
  • Prices have not kept pace with operating costs
  • Capital intensity for both refineries and smelters have risen
  • Incentive pricing - assumptions employed
  • Model output - long run equilibrium alumina and prices

In this report there are 8 tables or charts, including:

  • IRR methodology- the rationale and risks
  • Prices have not kept pace with operating costs
    • Raw material, electricity, energy and alumina prices
    • Raw material, electricity and aluminium prices
    • Alumina prices and refinery cash costs, 2000-2012 (US$/t aluminium)
    • Aluminium prices and smelter cash costs, 2000-2012 (US$/t alumina)
  • Capital intensity for both refineries and smelters have risen
    • Refinery capital intensity outside of China, 1980-2016 (US$/t installed capacity)
    • Smelter capital intensity outside of China, 1980-2016 (US$/t installed capacity)
  • Incentive pricing - assumptions employed
  • Model output - long run equilibrium alumina and prices
    • Historical and equilibrium alumina prices (2012 US$/t alumina)
    • Historical and equilibrium aluminium prices (2012 US$/t aluminium)
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