Markets

The most important risks and challenges that confronted the aluminium industry in 2018 were the supply of raw materials, US import tariffs on special aluminium products and the resulting negative effects of trade diversion. The manufacturers
of aluminium and aluminium products in Germany reported falls in output across the board.

Markets for aluminium products in Germany

Turnover in the German aluminium industry in 2018 totalled 21.6 billion euros. Plants were thus able to boost their turnover by 2.7 compared with the previous year. Whereas foreign businesses remained static on 9.4 billion euros, the domestic businesses increase to 12.2 billion euros. The development in turnover is closely linked to the quoted price for aluminium on the London Metal Exchange. Metal prices rose 2.5 per cent from 1,742 to 1,785 euros per tonnes aluminium.

Aluminium industry at a glance

The most important risks and challenges that confronted the aluminium industry in 2018 were the supply of raw materials,
US import tariffs on special aluminium products and the resulting negative effects of trade diversion. The manufacturers of aluminium and aluminium products in Germany reported falls in output across the board.

Despite this, turnover in the German aluminium industry increased 2.7 per cent to 21.6 billion euros. While export business stagnated at 9.4 billion euros, domestic business grew to 12.2 billion euros. The main reason for the increase in sales was a 2.5 per cent year-on-year increase in metal prices on the London Metal Exchange (LME), from an average of 1,742 euros to 1,785 euros per tonne of aluminium. One of the reasons for this rise was the increasing uncertainty in the supply of raw materials caused by the US-Russia sanctions.

In 2018, around 66,000 people were directly employed in the 251 plants of the German aluminium industry. Compared with 2017, this represented growth in employment of 3.8 per cent. In addition, the aluminium industry generates employment in related branches of the economy and can thus be described as an employment-relevant industry in Germany.

The structure of the markets for aluminium products hardly changed in 2018. There was only a slight shift between the mechanical engineering and iron and steel industries. The importance of the mechanical engineering market has risen to seven per cent, while the relevance of the iron and steel industry has fallen to five per cent. The shares of the transport (48 per cent), construction (15 per cent), packaging (10 per cent), electrical engineering (7 per cent), household goods and other end-users (4 per cent each) sectors remained unchanged from the previous year.

The aluminium industry is highly dependent on imports of raw materials. This was clearly evident last year, when the supply of aluminium oxide to the primary smelters was subject to a high default risk as a result of the sanctions against Russia. The sanctions also led to a high degree of uncertainty in the supply of raw aluminium. Measured in terms of net imports, the potential shortfall in supply here is around two million tonnes.

Contact

Dr. Andreas Postler

Head of Economics and Trade Policy

Phone: +49 211 4796-118
e-mail: andreas.postler@aluinfo.de