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The global aluminium market size was USD 164.23 billion in 2019 and is projected to reach USD 242.44 billion by 2027, exhibiting a CAGR of 5.7% during the forecast period.
Aluminium is an element with a silvery-white luster and is non-magnetic, and ductile in nature. It is the most abundant metal in the earth’s crust and is represented by the symbol Al. The metal is showcasing high demand from end-users including aerospace, electrical, and packaging. The increasing demand for packaged foods, coupled with the rising substitution of stainless steel with aluminium by automotive manufacturers is acting as a market driver. The rising demand for electric vehicles and OEM manufacturers is also supporting the growth of the market. However, disruptions in the supply chain due to temporary shutdowns of mines are projected to have negative effects on the market growth.
A Slowdown in Manufacturing Sector due to COVID-19 Pandemic to Decline Growth
The COVID-19 pandemic is constantly causing significant uncertainty in the market. The fall in the GDP of countries and the slowdown in the manufacturing sector have further reduced the activities for aluminium production. Mining activities of bauxite ore have been put on hold. The demand for semi-finished products from consumers is declining due to the shortage of workers in the manufacturing sectors, as well as the fall in demand from the aerospace and automotive industries. However, foils and cans producers are exhibiting positive growth due to the rising consumption of packaged foods.
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Rising Incorporation of Aluminium in the Automotive & Transportation Industry is a Current Trend
Although aluminium has been used in automobiles for many years, its proportion of new vehicles is rising. This metal is highly preferred by automotive engineers and designers for reducing emissions and increasing fuel economy. Electric vehicle manufacturers are using this metal for reducing the weight of the vehicle and achieving a better driving range. Automotive manufacturers such as Mercedes and BMW are increasingly substituting stainless steel with aluminium as it exhibits similar physical properties and its lightweight nature. The above-mentioned factors are estimated to drive market growth.
Increasing Popularity of Secondary Aluminium to Drive Growth
Secondary or recycled aluminium accounts for a significant aluminium market share in global consumption. The scrap obtained from automotive, equipment, beverage cans, and machinery is reprocessed and reused due to its cost-efficiency. The reprocessing of secondary metal or scrap consumes a fraction of the energy required for producing new metal from ore, thereby reducing the harm towards the environment. Moreover, initiatives such as the establishment of car dismantling and shredding facilities and depollution centers are expected to boost market growth. Additionally, large scale adoption of the metal in the transportation industry is anticipated to further increase aluminium consumption.
Implementation of Stricter Environmental Regulations to Hamper Growth
The implementation of stringent environmental regulations by governments and associations will have a negative effect on the market. The rising environmental issues and continue increasing expectations from the citizens towards improving the rising pollution levels has forced several countries to incorporate a new set of rules. Smelting facilities have been asked to meet new emissions standards which have increased the cost of products. Furthermore, it is known to have detrimental effects on human beings. Its exposure can have effects such as headaches, rashes, asthma, and insomnia. The powdered form can ignite or explode, thereby posing workplace hazards and its inhalation can cause pulmonary fibrosis. The above-mentioned factors are anticipated to hamper the market growth.
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Transportation Segment to Grow at Quicker Pace during 2020-2027
Based on end-use, the market is segmented into construction, transportation, packaging, electrical, consumer durables, machinery & equipment, and others. The transportation segment accounted for the largest share of the market in terms of end-use. The increasing adoption of the metal in vehicles due to its less weight and superior physical properties is propelling the growth of this segment.
The packaging segment is expected to grow at a substantial CAGR during the forecast period. The increasing demand for aluminium from packaged food manufacturers due to its non-permeable nature is projecting the growth of this segment.
Asia Pacific Aluminium Market Size, 2019 (USD Billion)
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The market size in Asia Pacific stood at USD 103.25 billion in 2019. It is the major contributor to the growth of the market owing to the presence of significant consuming countries including China, Japan, and India. The growing construction sector and automotive industry are propelling the demand for the metal in the region.
Factors such as the implementation of regulations to minimize emissions from vehicles, combined with the high demand from end-use industries including packaging and solar panels are leading to the growth of the market in Europe.
The market in North America is characterized by the high demand from the automotive & transportation industry. The adoption of this metal by EV manufacturers to reduce the weight of vehicles is a prominent factor driving the market growth in this region.
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In Latin America and the Middle East & Africa, the rising demand from end-users such as construction, consumer durables, and equipment are the factors accountable for the growth in this region. The rising construction and infrastructure development activities in developing countries of these regions are further supporting the growth of the market.
Key Players Focus on Serving Numerous Industries to Increase their Presence in Market
The global market is fragmented in nature. UC RUSAL, Alcoa Corporation, CHALCO, and Rio Tinto are the key players in the market. These key players are investing in research and development activities to serve numerous industries. They are implementing various growth strategies such as offering vast product portfolios, strengthening their distribution networks, expansions, and acquisitions to maintain their dominance in the market.
An Infographic Representation of Aluminium Market
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The market research report provides detailed market analysis and focuses on key aspects such as leading companies, product types, and leading end-use of the product. Besides this, the report offers insights into the aluminium market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the advanced market over recent years.
Value (USD Billion) and Volume (Million tons)
Fortune Business Insights says that the global market size was USD 164.23 billion in 2019 and is projected to reach USD 242.44 billion by 2027.
In 2019, the Asia Pacific market value stood at USD 103.25 billion.
Growing at a CAGR of 5.7%, the market will exhibit rapid growth in the forecast period (2020-2027).
Transportation segment is expected to be the leading segment in this market during the forecast period.
The increasing popularity of secondary aluminium amongst the OEMs is the key factor driving the market.
UC RUSAL, CHALCO, Riot Tinto, and Alcoa Corporation are major players in the global market.
Asia Pacific dominated the market share in 2019.
Superior physical properties and adoption in automobiles due to its less weight are the factors driving the product adoption.
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