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Saudi Arabia’s Aluminum Unwrought Market Outlook Report

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Aluminum smelters (unwrought producers) fall into two categories: primary and secondary smelters. Molten aluminum cast as unwrought products can be produced either through alumina electrolysis in primary smelters or through remelting scrap and pure ingots in secondary smelters. Primary smelting is a cost-intensive process; thus, such plants are usually large-scale producers that can be economical with capacities above 100,000 tonnes. But remelting aluminum in secondary smelters requires much lower costs, making small-scale capacities economical.

Secondary smelting capacity is limited in Saudi Arabia and most of the unwrought aluminum comes from Ma’aden’s primary smelter. Unwrought aluminum is in three forms: ingots, billets, and slabs. While aluminum ingots are produced through single-batch casting of molten aluminum in 1,000lb or 50lb molds, slab and billets are produced through direct chill casting. Ingots are re-melted before use, but billets and slabs are usually extruded and rolled, respectively, into profiles and flat products. Considering there is only one integrated hot rolling mill in the country that also produces slabs, it does not offer its slabs in the market.

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Product Description

With a GDP of over $792 billion in 2019, Saudi Arabia was the largest economy in the region that year. The country’s economy, the second richest country in terms of natural resources, is heavily dependent on oil, its main natural resource. But since the introduction of the 2030 Vision in 2016, the country has determined to minimize oil reliance. In accordance with the goals defined in the vision, state-owned Ma’aden signed a joint venture agreement with Alcoa for aluminum smelting capacity in 2010; the first primary aluminum was produced in 2013 and before long, the operation was ramped up to full capacity. In the early years, Ma’aden had to import alumina due to technical issues in its alumina refinery as well as the tightness in alumina supply. After 2015, when these issues were resolved and the alumina refinery capacity was completed, alumina imports decreased. The country’s alumina demand is currently met almost entirely from domestic mineral reserves. This minimizes the risk of raw materials for aluminum production to very low levels. As a result, the country’s downstream aluminum part has rapidly developed over the recent years.

Market drivers of unwrought aluminum

The high electrical and thermal conductivity of aluminum combined with its price advantage over copper have turned it into a major substitution threat for the red metal. Aluminum is becoming even more attractive as copper prices continue to rise and the price spread with copper widens. Currently, conductors and radiators are two of the most important cases of copper consumption that have been replaced by aluminum. Given Saudi Arabia’s 2030 Vision aiming to cut oil reliance and develop domestic industries, many end users of aluminum such as construction and automotive will grow. The government is expected to provide adequate support in supplying raw materials (from domestic sources) for these industries. This will drive the production of aluminum semis in Saudi Arabia, boosting demand for unwrought aluminum.

Saudi Arabia reported the first case of Covid-19 in early March 2020. Lockdown measures were then implemented, leading to a 70% drop in the country’s mobility index. As the pandemic continued to spread across the country, more strict measures were taken, putting further pressure on the mobility index. The country is now past the first wave of Covid-19, but many are still forecasting worse to come in the coming months. Thus, lockdowns are expected to continue, albeit temporarily, disrupting industrial performance and eventually lead to a decline in demand for aluminum semis and, consequently, unwrought aluminum.

Overview of Saudi Arabia’s unwrought aluminum market

A major portion of the unwrought aluminum in Saudi Arabia’s market comes from Ma’aden. Secondary smelters, already underdeveloped due to a lack of robust drivers, were further discouraged by the 740,000-tonne primary smelting capacity. Thus, as soon as the primary smelter came on stream, Saudi Arabia’s trade balance shifted from net imports into net exports. The country’s net exports spiked in the early years of the smelter’s activity, but then slowed down in the later years. Downstream capacities, especially Ma’aden’s rolling mill, are the major reason for the slowdown in net exports. With the expected development in the country’s downstream capacity, the upward trend in net exports is expected to come to a halt over the coming years.

Breakdown of Saudi Arabia’s unwrought aluminum market

Domestic demand for unwrought aluminum (for both primary and secondary products, separately) in the forecast timeframe as well as the previous period has been broken down using three factors. The first factor breaks down the market into three categories based on alloy material: commercially pure aluminum, heat-treatable alloys, and non-heat-treatable alloys. Past and future trends for each type of material have been analyzed. Commercially pure aluminum holds the largest share of the market for primary unwrought aluminum; in the secondary market, heat-treatable alloys take the largest share. In the second breakdown, products are distinguished based on product type: ingots, billets, and slabs. A major portion of primary unwrought products are ingots, while billets are the most common form of secondary unwrought. Finally, using the third factor, unwrought aluminum is categorized based on consumption. Secondary smelters are the largest consumers of primary unwrought aluminum, while extrusion plants are the largest consumers of secondary unwrought aluminum.

Key players in Saudi Arabia’s unwrought aluminum market:

  • Ma’aden
  • Al-Buraq Metals Recycling Company (RIYADH)
  • Wadi Rum Metals Recycling Co. (JEDDAH)

Additional Information

Industry

Unwrought aluminum
Region

Saudi Arabia
Report Type

Industry Report

Specifications

Report Attribute Details
The base year for estimation 2020
Historical data 2010-2019
Forecast period 2020-2025
Quantitative units Value in USD and Volume in Tonne
Report coverage Market Overview, Dynamics, Market Outlook, Risks to Forecast, Consumer Market, Industry Overview, Market Landscape, Competitive Landscape, Market Attractiveness, External Macro Environment Analysis
Segments covered Source, Composition, Type, Application
Pricing and purchase options Please explore our purchase options to meet your exact research needs.

Reasons to Buy

  • Recognize the geographical distribution of import demand
  • Identify the current and future key players of the trading market
  • Achieve a better insight on potential target markets
  • Understand the behavior of major suppliers/customers either globally or regionally
  • Identify competitors as a feed for market analysis

Table of Content

  1. Executive summary
  2. Introduction
    • Objective
    • Market under study
    • Product
      • Product specifications
      • Consumption structure
        • Applications
        • Physical properties
      • Subjects discussed
      • Geographical scope under study
      • Study timeframe
      • Study currency
      • Potential audience
  1. Market dynamics
    • Market drivers
    • Restraints
    • Opportunities
    • Challenges
  2. Market overview
    • Market size
    • Industry capacities
      • Existing capacities
        • Capacity distribution
        • Geographical distribution of capacities
      • Future capacities
    • Output
      • Output trends
      • Operating rates
    • Consumption
      • Consumption trend
      • Consumption Share of domestic product
    • Trade
      • Exports
      • Imports
      • Trade balance
      • Market balance
    • Market breakdown by product type
    • Market breakdown by product type
    • Market breakdown by application
    • Inventory
      • Producers inventory
      • Consumers inventory
      • Traders inventory
  1. Market outlook
    • Market factors
      • Raw materials
      • Costs and prices
      • Competition
      • The government
      • Other factors
    • Future scenarios
    • Risks to forecast
  2. Consumer markets
    • End-user markets
      • Building construction
      • Infrastructure construction
      • Transportation manufacturing
      • Industrial equipment manufacturing
      • Durable goods manufacturing
      • Consumable goods manufacturing
    • Direct consumer markets
      • Major Direct consumers
        • Existing capacities
        • Drivers
  1. Export potentials
    • Destinations
      • Trade and insurance costs
      • Import market suppliers
      • Producers potential share
  1. Industry overview
    • Raw materials
      • The supply volume of raw materials
      • Supply channels of raw materials
      • Raw materials procurement costs
    • Cost structure of producers
    • Production cost curve
    • Industry value added
    • Generated new scrap
    • Technology
  2. Market landscape
    • Domestic sales markets
      • Pricing in the domestic market
      • Potential domestic demand
      • Trade agreements for imports
      • Foreign suppliers
    • Foreign sales market
      • Prices
      • Potential markets overview
      • Trade agreements for exports
      • Foreign customers
  1. Competitive landscape
    • Producers
      • Company profile
      • Revenue structure
      • Gross profit margins
      • Capacity, output and sales
    • Consumers
      • Company profile
      • Revenue structure
      • Gross profit margins
      • Capacity, output and sales
  1. Market attractiveness
    • Industry rivalry
    • Threat of new entrants
    • Threat of substitutes
    • Bargaining power of buyers
    • Bargaining power of suppliers
    • Conclusion of Porter analysis
  2. PESTEL analysis
    • Political factors
    • Economic factors
    • Social factors
    • Technology factors
    • Environmental factors
    • Legal factors
  3. SWOT analysis
    • Large-scale companies with favorable conditions
      • Short-term strategies
      • Long-term strategies
    • Large-scale companies with unfavorable conditions
      • Short-term strategies
      • Long-term strategies
    • Small enterprises with favorable conditions
      • Short-term strategies
      • Long-term strategies
    • Small enterprises with unfavorable conditions
      • Short-term strategies
      • Long-term strategies

List of Figures

  1. Output and consumption; 2010-2019
  2. Market share of product applications; 2019
  3. Market surplus; 2019-2025
  4. Production process flowchart
  5. Market size; 2010-2025
  6. Existing capacity; 2010-2019
  7. Capacity distribution; 2019
  8. Geographic distribution of capacities; 2019
  9. Development of future capacity; 2010-2025
  10. Amount of output; 2010-2025
  11. Operating rates of production plants; 2010-2025
  12. Amount of consumption; 2010-2025
  13. Consumption share of domestic product; 2010-2025
  14. Exports of product; 2010-2019
  15. Imports of product; 2010-2019
  16. Historical trade balance; 2010-2019
  17. Future Market balance; 2020-2025
  18. Market output breakdown by alloy type; 2010-2025
  19. Market consumption breakdown by alloy type; 2010-2025
  20. Market balance breakdown by alloy type; 2010-2025
  21. Market output breakdown by product type; 2010-2025
  22. Market consumption breakdown by product type; 2010-2025
  23. Market balance breakdown by product type; 2010-2025
  24. Market consumption breakdown by application; 2010-2025
  25. Inventories of raw materials and products at producers factories; 2010-2019
  26. Consumers’ inventory of product; 2010-2019
  27. Traders’ inventory; 2010-2019
  28. Production forecast, according to raw materials and sales analysis; 2019-2025
  29. Market surplus; 2019-2025
  30. The share of end-user industries in the consumption; 2010 and 2019
  31. Changes in the end-consumption of extrusion products; 2019 vs 2025
  32. Applications in building construction industry; 2019
  33. Applications in infrastructure construction industry; 2019
  34. Applications in transportation manufacturing industry; 2019
  35. Applications in industrial equipment manufacturing industry; 2019
  36. Applications in durable goods manufacturing industry; 2019
  37. Applications in consumable goods manufacturing industry; 2019
  38. Capacity distribution structure of direct consumers; 2019
  39. Existing capacities of direct consumers in each province; 2019
  40. Suppliers of the export potential destination; 2019
  41. Historical exports to the export potential destination and future potential; 2016-2025
  42. Up-stream domestic supply; 2010-2019
  43. Raw materials domestic supply; 2010-2019
  44. Supply channels of producer plants
  45. Spot price of raw material in the market; 2010-2025
  46. Cash cost structure for production the product; 2019
  47. Production cost curve of the plants; 2019
  48. Gross value added of the industry; 2010-2019
  49. Generated new scrap; 2010-2019
  50. Sales channels
  51. Realized price of the product in the market; 2010-2025
  52. Potential demand of each province; 2019
  53. The main foreign suppliers to the market; 2010-2019
  54. FOB price vs domestic market; 2010-2025
  55. Map of global major importers > 20,000t; 2019
  56. Major foreign customers; 2010-2019
  57. Revenue structure of the producers; FY2019
  58. Sales income and gross profit margin of the producers; FY2010-2019
  59. Output and sales of the producers; FY2010-2019
  60. Revenue structure of the consumers; FY2019
  61. Sales income and gross profit margin of the consumers; FY2010-2019
  62. Output and sales of the consumers; FY2010-2019
  63. SWOT matrix for large-scale companies with favorable conditions
  64. Strategies positioning for large-scale companies with favorable conditions
  65. SWOT matrix for large-scale companies with unfavorable conditions
  66. Strategies positioning for large-scale companies with unfavorable conditions
  67. SWOT matrix for small enterprises with favorable conditions
  68. Strategies positioning for small enterprises with favorable conditions
  69. SWOT matrix for small enterprises with unfavorable conditions
  70. Strategies positioning for small enterprises with unfavorable conditions

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