The Brazilian Aluminum Association (ABAL)** Adjarma Azevedo stated that Brazilian aluminum production is experiencing a decline as producers cannot compete with low-cost imports from countries such as China, and Brazil may soon become a net importer of aluminum.
In an interview with Dow Jones Newswires this week, Azevedo said that in 2010 Brazil’s primary aluminum output fell to 1.53 million tons, and in 2008 this figure was 1.63 million tons, due to the high energy costs that caused the closure of two domestic smelters.
He also said that low-cost imports of aluminum accounted for more domestic consumption growth, this year may exceed 9%, after the market recovered from global institutions and the crisis, in 2010 this proportion reached 27%.
The Brazilian Aluminum Association (ABAL) stated that imports of aluminum products, including aluminum scrap, climbed to 241,300 tons last year and 161,600 tons in 2009. In 2010, Brazil’s aluminum exports fell from 921,000 tons in 2009 to 733,000 tons, as more and more metals are sold in the domestic market to meet growing demand.
Aluminum imports will double to meet demand, as domestic energy prices, taxation, and logistics are all experiencing difficulties. The strong Brazilian currency also increases the operating costs of Brazilian non-ferrous metal producers.
"In the end, Brazil will abandon the exporter's identity and become a net importer of primary aluminum. This situation may appear in 2012," said Azevedo. He added that "the Brazilian aluminium production industry is not competitive and is undergoing deindustrialization."
In the past two years, Brazil’s mining giant Vale Vale (VALE) closed operations at its Valesul smelter in Rio de Janeiro. The electrolytic aluminum plant has stopped production in March 2009 and its capacity is 96,000 tons/year.
Alcoa’s Novelis, which also operates the Aratu aluminum smelter in Brazil, which has a capacity of 45,000 tons per year, has made the plant unprofitable due to high energy prices and other structural costs.
The Brazilian Aluminum Association (ABAL) stated that the energy and tax costs are equivalent to 51% of Brazilian aluminum prices.
The Brazilian Aluminum Association (ABAL)** also stated that despite the expansion of demand, the narrowing of operating profits means that no company will expand aluminum smelting capacity. It is expected that Brazil’s aluminum demand will increase by 1.2 million tons in 2010 by 2020. Fan.
In January alone, Brazil’s domestic consumption of aluminum products jumped by 17.7% from the same period in 2010.
The Brazilian Aluminum Association (ABAL)** Azevedo said that the association is studying measures to protect Brazilian aluminum producers against the impact of imports from Chinese aluminum products. Given that China’s aluminum exporters enjoy a 12-15% export tax rebate, the approach may include raising the import tariff on aluminum products.
He also said that compared to the ***, the Brazilian currency Renal has a strong trend, which is "a problem that needs to be dealt with by the Brazilian producers and the government."
In an interview with Dow Jones Newswires this week, Azevedo said that in 2010 Brazil’s primary aluminum output fell to 1.53 million tons, and in 2008 this figure was 1.63 million tons, due to the high energy costs that caused the closure of two domestic smelters.
He also said that low-cost imports of aluminum accounted for more domestic consumption growth, this year may exceed 9%, after the market recovered from global institutions and the crisis, in 2010 this proportion reached 27%.
The Brazilian Aluminum Association (ABAL) stated that imports of aluminum products, including aluminum scrap, climbed to 241,300 tons last year and 161,600 tons in 2009. In 2010, Brazil’s aluminum exports fell from 921,000 tons in 2009 to 733,000 tons, as more and more metals are sold in the domestic market to meet growing demand.
Aluminum imports will double to meet demand, as domestic energy prices, taxation, and logistics are all experiencing difficulties. The strong Brazilian currency also increases the operating costs of Brazilian non-ferrous metal producers.
"In the end, Brazil will abandon the exporter's identity and become a net importer of primary aluminum. This situation may appear in 2012," said Azevedo. He added that "the Brazilian aluminium production industry is not competitive and is undergoing deindustrialization."
In the past two years, Brazil’s mining giant Vale Vale (VALE) closed operations at its Valesul smelter in Rio de Janeiro. The electrolytic aluminum plant has stopped production in March 2009 and its capacity is 96,000 tons/year.
Alcoa’s Novelis, which also operates the Aratu aluminum smelter in Brazil, which has a capacity of 45,000 tons per year, has made the plant unprofitable due to high energy prices and other structural costs.
The Brazilian Aluminum Association (ABAL) stated that the energy and tax costs are equivalent to 51% of Brazilian aluminum prices.
The Brazilian Aluminum Association (ABAL)** also stated that despite the expansion of demand, the narrowing of operating profits means that no company will expand aluminum smelting capacity. It is expected that Brazil’s aluminum demand will increase by 1.2 million tons in 2010 by 2020. Fan.
In January alone, Brazil’s domestic consumption of aluminum products jumped by 17.7% from the same period in 2010.
The Brazilian Aluminum Association (ABAL)** Azevedo said that the association is studying measures to protect Brazilian aluminum producers against the impact of imports from Chinese aluminum products. Given that China’s aluminum exporters enjoy a 12-15% export tax rebate, the approach may include raising the import tariff on aluminum products.
He also said that compared to the ***, the Brazilian currency Renal has a strong trend, which is "a problem that needs to be dealt with by the Brazilian producers and the government."
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