Mordor Intelligence report that the aluminium market was evaluated at USD 112 billion in 2021 and is projected to register a compound annual growth rate (CAGR) of over 6% during the forecast period 2022-2027 (Base year 2020).
World markets have now reached pre-pandemic levels and is expected to grow steadily over the forecast period state Mordor.
Over the medium term, the major factor expected to drive the market studied includes increasing construction activities in the Asia-Pacific region. On the flip side, the slowdown in the global automotive industry is expected to hinder the growth of the market in the forecast period 2022-2027. Overall the construction segment is anticipated to lead the aluminium world market between 2022-2027.
The Asia-Pacific region represents the largest market, and it is also expected to be the fastest-growing market over the forecast period due to increasing consumption from countries such as China, India, and Japan.
Increasing demand from the Building and Construction Industry is one of the key factors driving the market studied in recent times state Mordor, with the Asia-Pacific construction sector the largest globally, and they report it is growing at a healthy rate, owing to increases in the population, middle-class incomes, and urbanization.
There has and will continue to see accelerated demand for hotels, shopping malls, high-rise buildings, arenas, and stadiums (both outdoor and indoor), in turn boosting the construction industry and driving the demand for aluminium in the region.
The report highlights that China remains in the midst of a construction mega-boom. The country has the largest building market in the world, making up 20% of all construction investments globally. The country alone is expected to spend nearly USD 13 trillion on buildings by 2030.
The post-pandemic recovery is supported because of the surge in infrastructure spending from the Chinese government. China is set to exceed global average growth rates to reach nearly USD 1.4 trillion by 2030.
Moreover, according to the National Development and Reform Commission of China, the Chinese government approved 26 infrastructure projects at an estimated investment of about USD 142 billion in 2019, which were expected to be completed by 2023. The growing infrastructure investment and building of complex structures are expected to drive the aluminium market.
In addition to this, Asia-Pacific has the largest low-cost housing construction segment, led by China, India, and various Southeast Asian countries.
The construction industry in ASEAN countries and India represent one of the fastest-growing markets and is anticipated to account for a major share in the global construction market. Countries, such as Indonesia, Singapore, Thailand, Vietnam, the Philippines, and India, in the Asia-Pacific region, have been witnessing robust growth in construction activities.
Singapore’s infrastructure spending is around USD 10 billion per year, the country is eyeing SGD 90 billion in infrastructure bonds as of April 2021. Thailand too is also embarking upon various major infrastructure projects including the high-speed rail linking three airports, the U-Tapao airport and Eastern aviation city development project, and the Map Ta Phut industrial port development project, among others.
India’s construction alone is among the biggest in the Asia-Pacific region. Various policies implemented by the Indian government, such as Smart Cities projects, are expected to give a boost to the construction industry in the country. Additionally, Indian customers are adapting to better lifestyles and modern technologies. This is propelling the usage of aluminium products.
India is likely to witness around USD 1.3 trillion of investment in housing over the next seven years and is likely to witness the construction of 60 million new homes in the country. According to India Brand Equity Foundation, India is expected to become the world’s third largest construction market by 2022. In Union Budget 2021, to support initiatives, such as “Housing for All” and “ Smart Cities Mission”, the government allocated INR 13,750 crore (USD 1.89 billion) to AMRUT and Smart Cities Mission. The availability of affordable housing is expected to rise to around 70% by 2024 in India, with the Indian real estate industry likely to reach USD 1 trillion by 2030. It may contribute approximately 13% to the country’s GDP by 2025.
According to the Indian Department for Promotion of Industry and Internal Trade (DPIIT), construction development and infrastructure activities sectors received FDI inflow amounting to USD 25.69 billion and USD 16.97 billion, respectively, between April 2000 and June 2020.
In North America, the US is the largest market for residential construction and is one of the major growth markets in the world. Almost 80% of individuals prefer single-family housing as an end goal, and almost 70% of people are executing this goal, thus, resulting in an increase in the number of houses being constructed every year.
India is likely to witness an investment of around USD 1.3 trillion in housing over the next seven years, during which it is likely to witness the construction of 60 million new homes.
Overall, the recovering construction activities worldwide are expected to drive the demand for aluminium from the building and construction industry during the forecast period.
