Inalum, the parent company of state owned holding, will increase to 1 million tons of capacity in 2025 which is good. However, what about its demand? Is it going to be as big as the capacity in long term period? Do not let this increasing capacity only for wasting the very much needed electricity.
PT Indonesia Asahan Aluminium Persero (Inalum) currently has 265 tons of capacity per year. The company will increase it to 500.000 tons per year by early 2020-2021. And by 2025, it could be 1 million tons of aluminium ingots per year, said the President Director of PT Inalum, Winardi Sunoto at Ministry of Industry, Thursday (15/9/2016). Therefore, Inalum will build one new smelter which will be located in either North Borneo or West Borneo. The investment estimation is US$ 1.5 billion.
There will be good news for demand, but there will be bad news that it should be aware. Norsk Hydro, the Norwegian aluminium producer, predicts that demand for global aluminium will grow by 4-5% this year. Most of the unexpected growth comes from the unexpected activity in China, until 5-7%. Besides, automotive industry growth and demand will also affect demand for aluminium. While in India, Aluminium Association of India (AAI) and Crisil Research predicts that Indian aluminium consumption will reach 5 million tons by 2020 and 8 million tons in 2025. It currently reaches 3.2 million tons.
But at the same time, it should be aware since China is the main reason of demand growth and also the biggest aluminium producer. The deceleration growth and the increasing capacity in China can possibly make huge price volatility in the world.
Add Comment