20



### ALUMINUM 1

(Data in thousand metric tons of metal unless otherwise noted)

Domestic Production and Use : In 2004, 6 companies operated 14 primary aluminum reduction plants; 6 smelters continued to be temporarily idled. Based upon published mark et prices, the value of primary metal production was $4.5 billion. Aluminum consumption was centered in the East Cent ral United States. Tran sportation accounted for an estimated 38% of domestic consumption; the remainder was used in packaging, 29%; building, 13%; consumer durables, 6%; electrical, 6%; and other, 8%.

Salient Statistics—United States : 2000 2001 2002 2003 2004 e

Production: Primary 3,668 2,637 2,707 2,703 2,500 Secondary (from old scrap) 1,370 1,210 1,170 1,070 1,200 Imports for consumption 3,910 3,740 4,060 4,130 4,300 Exports 1,760 1,590 1,590 1,540 1,700 Consumption, apparent 2 7,530 6,230 6,320 6,130 6,300 Price, ingot, average U.S. market (spot), cents per pound 74.6 68.8 64.9 68.1 82.0

Stocks: Aluminum industry, yearend 1,550 1,300 1,320 1,400 1,500 LME, U.S. warehouses, yearend 3 ( 4 ) 28 45 207 100 Employment, number 5 77,800 71,200 61,700 58,300 58,200 Net import reliance 6 as a percentage of apparent consumption 33 38 39 38 41

Recycling : In 2004, aluminum recovered from purchased scrap was ab out 3 million tons, of which about 60% came from new (manufacturing) scrap and 40% from old scrap (discarded aluminum products). Aluminum recovered from old scrap was equivalent to about 19% of apparent consumption.

Import Sources (2000-03) : Canada, 59%; Russia, 17%; Venezuela, 5%; Mexico, 2%; and other, 17%.

Tariff : Item Number Normal Trade Relations

12-31-04 Unwrought (in coils) 7601. 10.3000 2.6% ad val. Unwrought (other than aluminum alloys) 7601.10.6000 Free. Waste and scrap 7602.00.0000 Free.

Depletion Allowance : Not applicable. 1

Government Stockpile : None.

Prepared by Patricia A. Plunkert [(703) 648-4979, pplunker@usgs.gov, fax: (703) 648-7757]21



### ALUMINUM

Events, Trends, and Issues : Domestic primary aluminum production decr eased owing to cutbacks attributed to increased energy and alumina costs. Mo st of the production de creases continued to take place in the Pacific Northwest. Domestic smelters operated at about 63% of rated or engineered capacity.

Imports for consumption conti nued to increase, filling some of the supply deficit created by incr eases in demand and decreases in domestic production. Canada and Russia contin ued to account for approximately three-fourths of total imports. U.S. exports also increased in 2004. Canada, Me xico, and China, in descending order, received more than 80% of total U.S. exports.

Although the price of primary aluminum fluctuated through S eptember 2004, it generally trended upward. In January, the average monthly U.S. market price for primary ingot quoted by Platts Metals Week was 76.6 cents per pound; in September, the price was 84.4 cents per pound. Prices on the London Metal Exchange (LME) followed the trend of U.S. market prices, but contracts traded in a slightly narrower range. The monthly average LME cash price for September was 78.2 cents per pound.

World production continued to increase as capacity expansions outside the Unit ed States were brought onstream and became fully operational. Inventories of me tal held by producers, as reported by the International Aluminium Institute, increased slightly through t he end of August to about 3.1 million tons. Inventories of metal held by the LME decreased dramatically during the year . At the beginning of 2004, LME invent ories exceeded 1.4 m illion tons, but by the end of September, inventories had fallen to 681 thousand tons, the lowest level since August 2001.

World Smelter Production and Capacity : Production Yearend capacity

2003 2004 e 2003 2004 e

United States 2,703 2,500 4,140 4,000 Australia 1,860 1,880 1,850 1,880 Brazil 1,380 1,450 1,420 1,450 Canada 2,790 2,640 2,790 2,850 China 5,450 6,100 5,700 6,800 Mozambique 405 510 410 540 Norway 1,150 1,250 1,200 1,300 Russia 3,480 3,600 3,500 3,600

South Africa 738 820 730 850

Venezuela 601 600 640 640 Other countries 7,160 7,500 8,100 8,400 World total (rounded) 27,700 28,900 30,500 32,300

World Resources : Domestic aluminum requirements cannot be me t by domestic bauxite re sources. Potential

domestic nonbauxitic aluminum resources are abundant and could meet domestic aluminum demand. However, no processes for using these resources have been proven econom ically competitive with t hose now used for bauxite.

The world reserve base for bauxite is sufficient to meet world demand for metal well into the 21st century.

Substitutes : Copper can replace aluminum in electrical applic ations; magnesium, titanium, and steel can substitute for aluminum in structural and ground transportation uses. Composites, steel, and wood can substitute for aluminum in construction. Glass, paper, plastics, and st eel can substitute for aluminum in packaging.

e Estimated.

1 See also Bauxite and Alumina.

2 Domestic primary metal production + recovery from old aluminum scrap + net import reliance.

3 Includes aluminum alloy.

4 Less than 1⁄2 unit.

5 Alumina and aluminum production workers (Nor th American Industry Classification System— 3313). Source: U.S. Department of Labo r, Bureau of

Labor Statistics.

6 Defined as imports – exports + adjustment s for Government and industry stock changes.

U.S. Geological Survey, Mineral Commodity Summaries, January 2005