【SMM Analysis】America's Aluminium Scrap: The Aluminum Association's Proposal to Ban Exports of UBC Scrap

America's Aluminium Scrap: The Aluminum Association's Proposal to Ban Exports of UBC Scrap

Introduction

Last week, the Aluminum Association (of America) released a white paper examining the flow of aluminium scrap of the United States, a sector that is starting to gain traction worldwide for its importance within the sectors and development goals of low carbon and circular sustainability goals, industrial competitiveness and strategic interests in national security.

Aluminium serves important roles in the automotive, electricity, construction and defence sectors among many others. Scrap aluminium takes this further by being a less costly and more environmentally friendly alternative to raw aluminium production: it is highly recyclable, and reduces energy consumption up to 95% when compared to processes involved in making raw aluminium from scratch. According to the Aluminum Association, recycled aluminium scraps now account for almost 85% of U.S.-made-aluminium.

Mapping America’s Aluminium Scrap Flows

According to the Aluminum Association, the U.S. generated 7.6 million metric tonnes of aluminium scrap in 2024, with 76% (5.6 million tonnes) consumed locally and 24% (2 million tonnes) exported. In detail, US exports of aluminium scrap mostly reach the Asian market, with India, Thailand, Malaysia, South Korea and China (including Hong Kong) being the top 5 importers of US aluminium scrap (HS 7602) in 2024, accounting for 77% of total US scrap aluminium exports. On the other hand, roughly 680 thousand tonnes of aluminium scrap was imported in 2024, with Canada and Mexico accounting for up to 90% of the import quantity.

Can We Keep It? The Case for America’s UBCs and Mill-Ready Scrap

The Aluminium Association highlights UBCs (Used Beverage Cans) as a type of aluminium scrap that should be increasingly important in the field of aluminium recycling. In 2023, the United States produced a total of 1.4 million tonnes of UBC scrap domestically, and imported 183 thousand tonnes of UBC scrap in the same year, primarily from Mexico and Canada.

As highlighted in the white paper, UBCs and mill-ready scrap are two key aluminium scrap types that are highly valuable, as they are clean, easy to recycle and have high recovery efficiency. UBCs especially, owing to their unique alloy composition and quality can undergo can-to-can recovery within a short time span of 60 days. Even though the USA produces a lot of UBC domestically, less than half of it is actually recycled, leaving a portion of downstream demand unfulfilled, which then imported UBCs and other scrap are required to fill in the gaps.

Similarly, mill-ready scrap is another highly valuable aluminium scrap type, but due to definition and segregation issues in existing data, its value and potential cannot be accurately predicted or calculated in any way. Even so, mill-ready scrap as a ready-to-melt material can be easily processed into downstream products with little cost involved when compared to raw aluminium or other kinds of aluminium scrap, and it will likely bring more good than harm if individually recycled and processed.

Strategic Implications: Why Export When We Need More?

The Aluminium Association’s report forewarns a shortage of aluminium scrap as a resource, even when discounting export quantities from the equation. In 2025, the US has a 4 million tonne supply gap for aluminium which is being met by importing ingots and raw aluminium, and that, and that aluminium scrap can effectively help reduce the supply shortage for aluminium within the United States. This becomes more potent when the US is developing in areas that have high aluminium requirements, like the automotive, defence and packaging industries. As critical sectors and their development rely on foreign aluminium imports for their stability, this opens the US up to geopolitical and economic tensions, creating supply-side vulnerabilities for the aluminium industry.

Aside from supply vulnerabilities, the Aluminium Association also raises national security and economic concerns that exporting aluminium scrap, especially to Asian economies like China, undercuts America’s industrial goals for its development. Amidst high development of China’s aluminium sector, US exports towards the Asian theatre risks growing foreign industries, leading often to unfair competition that loops back to further pressure local growth. Concerns also stem from security reasons: as aluminium serves as an essential material for defence and construction, exporting scrap weakens local industry bases and creates dependency on overseas supply chains for key industries.

A New Can of Worms: Proposed Measures and the Global Aluminium Scrap Supply Chain

To strengthen local industries and reduce dependency and volatility of the domestic aluminium supply chain, the Aluminum Association is proposing a plethora of measures directed at curbing the outflow of materials:

1. Banning Used Beverage Container (UBC) scrap exports outside of North America and onshore aluminium production from overseas.
2. Update U.S. HS Schedule and Schedule B codes to better incorporate different types of scrap, and to track trade flows in and out of the United States.
3. Improve scrap collection and sorting methods to increase readily available raw materials to meet the present supply gap in the United States.
4. Consider expanding export controls to mill-ready scrap, Zorba and other scrap as sorting and infrastructure improves; this can be done through methods ranging from bans to business license approaches.
5. Increase public-private cooperation to keep export restrictions up-to-date and better existing data and reporting processes.
6. Increase monitoring through custom checks and penalties to discourage illegal exports.

If related measures go through, especially an export ban on UBCs and later controls on other aluminium scrap, this could highly disrupt the global flow of available aluminium scrap. As of 2024 data by the ITC Trade Map, the United States is the largest exporter of aluminium scrap at 2 million tonnes, valued at 4 billion USD. With UBCs being a key classification of aluminium scrap, an actual ban on UBC exports would largely reduce the available raw materials in the market, especially as UBCs are considered a high quality material. The Asian market is likely to be the most impacted, with countries and regions like India, China and Southeast Asia seeing a likely drop in total aluminium scrap imported. North American states like Canada and Mexico on the other hand, will see little to no impact, as they are key American trading partners, and the Aluminum Association has also highlighted the importance of keeping a free flow of aluminium scrap between the North American states under the USMCA trade agreement.

Conclusion

The Aluminum Association’s white paper brings renewed attention to the increasingly strategic nature of aluminium scrap within the United States. Beyond being an environmental solution, aluminium recycling has evolved into an industrial and geopolitical issue: one that intertwines national security, supply chain resilience, and sustainable growth. As the data highlights, the U.S. both produces and consumes a vast quantity of aluminium scrap, yet continues to export a significant portion of it abroad. This paradox exposes structural inefficiencies in local recycling systems and reveals the tension between free trade and national self-sufficiency.