NEW YORK, May 5 -- Auto industry demand for aluminum is expected to improve this year, but the aerospace, construction and gas turbine markets for the metal will decline, Alcoa Inc (AA.N: Quote) said on Tuesday.

America's largest aluminum producer also expects global consumption of the metal, especially by China, to increase in 2010.

Alcoa's stock fell 4.4 percent to $12.56 in early trading on the New York Stock Exchange as the broad market also fell.

The forecasts were included in an Alcoa filing with the Securities and Exchange Commission dealing mostly with the aluminum producer's sustainability policies.

"In 2010, we expect market conditions for aluminum products in certain end markets, particularly automotive and commercial transportation, to improve," the company said in the filing.

"Other markets, including aerospace, building and construction, and industrial gas turbines, are expected to decline."

Alcoa told the SEC it projects an increase in the consumption of aluminum, especially in China. But increases in energy prices and continued currency movements are expected to be a challenge.

Chairman and Chief Executive Officer Klaus Kleinfeld noted 2009 was a challenging economic environment, with aluminum prices crashing, broad demand destruction and a credit crunch "that crippled our ability to initiate growth.

"We adopted a holistic response to this situation by initiating various actions...aimed at reducing costs, improving cash levels, and preserving liquidity."

Those actions included curtailing additional refinery and smelter capacity, which necessitated layoffs; identifying procurement efficiencies; reducing the quarterly dividend and issuing new equity and debt instruments.