Author: Paul Ploumis
27 Feb 2015 Last updated at 06:19:33 GMT
CANBERRA (Scrap Monster): Rusal- world’s largest aluminum producer believes that the global aluminum industry is likely to grow during the year. It also expects that the production growth outside of China may continue to remain subdued. Also, aluminum premiums in Asia are likely to remain under pressure due to rising exports of semi-manufactured products from China. Incidentally, global aluminum demand had surged by 7% in 2014.
The severe cost-control measures along with the decision to shutdown non-performing smelters helped the company to swing into net profit during 2014. Rusal had reduced production at seven smelters during 2014 in an attempt to lift the global supply demand balance situation. The company had reported net profit of $293 million in 2014 as against net loss of $3.32 billion posted in 2013. The margins were boosted by recovery in price of the metal during the year. The fall in ruble also played a significant role in boosting margins.
The company believes that worries surrounding the industry are not yet over completely. The fear of ‘overproduction crisis’ still hangs on. As a result, Rusal right now has no intentions to restart the mothballed aluminum smelter capacities.
According to Rusal, the global aluminum demand is expected to grow by another 6.5% in 2015 to 59 million tons. The Chinese aluminum demand is likely to post a growth of 9.5%, whereas in outside of China, the aluminum demand is expected to grow at a subdued rate of 3.4%. The markets outside of China will face supply deficit during 2015. Rusal expects relatively stronger demand growth during the second half of 2015.