MEXICO’S ALUMINUM INDUSTRY

Mexico, March 21, 2017

Mexico’s aluminum industry is highly dependent on imports and recycling of aluminum products. Mexico has limited resources of bauxite from which alumina (Al2O3) is extracted and converted to aluminum, for the same reason there are no alumina refineries in the country either. Despite of the above, Mexico’s aluminum value chain involves recycling of aluminum scrapped products and imports of aluminum secondary products. Mexico is importing aluminum waste and scrap from nine countries, predominantly from the U. S.

U. S. exports to Mexico of schedule 7602 amounted to $129,417,938 in 2016, according to the International Trade Administration. Numbers from the Mexican Ministry of Economy (SIAVI) report that 55,506 tons of aluminum wast and scrap were imported by Mexican companies the same year.

Mexico’s aluminum industry grows steadily at a 13 percent annual rate since 2011 and produces 1.6% of world’s global production[1]. Mexico’s aluminum industry grows following the trends of a number of industries including automotive, aerospace, electric, energy (photovoltaic) and appliance; the first one being the largest contributor to the growth of the aluminum industry.

The aluminum industry is of large important to Mexico’s economy since it contributes in about $7 billion to Mexico’s GDP; this industry is also a large job generator employing over 120,000 workers and professionals.

For the U. S., Mexico’s aluminum industry represented a $3.55 billion market in 2016 (Figure 1), a steady value since 2013. Mexico imports from the U. S. include aluminum plates, sheets and strips (HS 7606), aluminum bars, rods, and profiles (HS 7604) among others as seen in chart (Figure 2).

Aluminumtable

Figure 1

Aluminum in Mexico is purchased by secondary and tertiary manufacturers.

Key Secondary suppliers

As it was mentioned before, Mexico’s aluminum industry is relying in their capacity for recycling aluminum from scrapped aluminum parts, specially cans and other packaging products. Industry experts estimate that 97% of scrapped aluminum cans are recycled in any of the numerous recycling companies established in Mexico, 23 of which are the largest processors.

Only about 50% of the recycled aluminum is sent to U. S. and other countries for reprocessing. A list showing the largest recycling companies include Almexa[2] in the State of Mexico; Almetek in Coahuila, Arzyz in Nuevo Leon, Alretech in Hidalgo, Alucal in Veracruz, Aluminicaste in Guanajuato, among many others that are members of IMEDAL. Marubeni Mexico is also a significant player in this market and they operate out their offices in Mexico City and Queretaro. Most of these recyclers have installed technology to convert aluminum into billet, slab or forgings which are used by tertiary companies.

Aluminumchart
Figure 2.

TERTIARY COMPANIES

The automotive industry is the key driver of the aluminum industry in Mexico followed by the construction and the packaging industries. Companies like Nemak and Alcoa in Nuevo Leon are large consumers of secondary aluminum products for the automotive. Nemak is manufacturer of automotive parts such as cylinder heads, engine blocks and structural components and their products are utilized by almost any car manufacturer in Mexico and the world. Cuprum, also located in Nuevo Leon is a large manufacturer of industrial and architectural products including ladders, which are sold worldwide, also windows and profiles. Another important market segment in the aluminum industry is kitchenware manufacturing which is almost dominated by Grupo Vasconia. Grupo Vasconia is both importer and manufacturer for up to 20 kitchenware brands.

OPPORTUNITIES

The state of current aluminum industry in Mexico offers limited opportunities to the U. S. exporter. Mexico’s aluminum industry will welcome technologies that increase their capacity for recycling from scrapped aluminum products thus strengthening the value chain. Automation is also in demand at some extend to include process monitoring, data acquisition and safety. U. S exporters seeking to increase their exposure in this market may also opt for becoming members to IMEDAL and actively participate in their different working committees.

Events

  • Mexico Foundry Congress 2017, Queretaro, MX June 2107
  • Die Casting Congress South, Mexico City, MX March 2017

Industry associations

  • Instituto Mexicano del Aluminio (IMEDAL)
  • Camara Nacional del Aluminio, A. C.
  • International Aluminum Institute

[1] IMEDAL, Instituto Mexicano del Aluminio (Mexico)

[2] Part of Grupo Vasconia

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