Philip Martens, president and chief operating officer of aluminium producer and recycling firm Novelis, said that rapid urbanisation in developing countries and a push for sustainability were the drivers that would increase demand for the metal “beyond current projections”. He predicted the worldwide adoption of aluminium in industrial and consumer applications was “nearing a tipping point and may be about to surge”.
"Beverage cans, food packaging, appliances, construction, transportation and personal technology all are on the verge of a new boom in emerging markets,” he said.
Wave of demand
Martens added: “Food packaging also will see a new wave of demand. In just the next few years, more than two billion people will cross the official threshold out of 'poverty' and adopt lifestyles the developed world would begin to recognize as working class. When you look at the global performance of beverage companies, it's clear that the capacity to manufacture aluminium beverage containers and other food packaging will struggle to keep pace with demand."
Marco Georgiou, aluminium analyst for Cru Group, told FoodProductionDaily.com, that year-on-year growth in excess of 12 per cent was expected in global aluminium demand in 2010. But he explained that demand for aluminium had been hit hard by the economic downturn in 2009 and was therefore coming off a low base.
“We expect to see strong growth, particularly in China but also in Brazil and India. While food packaging will be an important factor, transport and construction will be the two major drivers,” he said.
Above trend growth
However, the analyst questioned the Novelis boss' claim that supply of aluminium drinks cans would struggle to keep up with demand in emerging markets.
“We do not see strong growth in beverage cans in China, India and Brazil - but above trend growth is more likely,” said Georgiou.
The expert analyst did agree with Martens that the lightweighting trend would continue to help boost demand for the material across all sectors.
Martens also highlighted aluminium’s recycability as a major advantage in the coming years.
"What other industry can claim the ability to make virtually all its new product from its old product – and with such an energy and cost saving relative to raw material?” he said. “Never has an economic agenda been so cleanly synchronized to an environmental agenda."