The sanctions introduced by the U.S. government against RUSAL have become another argument for developing the domestic market and deep metal processing. Moreover, all the prerequisites for this are in place. In particular, projects implemented by Russian companies of the industry, members of the Aluminium Association, are intended to increase the consumption and expand the deep processing of aluminium.
Currently, the Russian share in the global aluminium consumption is just 1.2% or as little as 6 kg of the winged metal per capita per year. This is very low in terms of the global economy. However, these figures indicate a great growth potential. Trends in the demand for aluminium in the domestic market also provide grounds for optimistic forecasts. For example, while primary aluminium consumption dropped by 9% in the post-crisis 2015, it increased by 4% in 2016 and grew by 11% last year. This is the highest increase in the world (China is the second, 8%).
As to the consumption structure in the domestic market, the leaders are the construction industry (21%), packaging and foil (20%), cable and conductor products (18%) and transport sector (16%). Meanwhile, considerable growth of the aluminium consumption is forecast in all these segments, like in certain other industries, in the coming years largely due to actions of RUSAL and members of the Aluminium Association that unites over 80 companies, producers of aluminium and alloys, as well as various products of winged metal.
Currently, members of the Aluminium Association are implementing dozens of large-scale projects in the mechanical engineering and automotive industries, construction, power and production of consumer goods. By uniting, they aim to stimulate deep aluminium processing and the launch of new products, improve the Russian regulatory framework, standardisation and technical regulation, certification and fight against counterfeit and ‘grey’ (of questionable legality) imports. For example, a key joint achievement of the Aluminium Association and RUSAL for the last year is the review and approval by the Ministry of Energy of Russia of an order that introduces new rules on arranging energy installations. This removed the ban that had existed in Russia since 2000 on using aluminium wiring in the construction of residential and public buildings and structures.
Besides, members of the Association take active efforts to remove administrative barriers for using aluminium in bridge construction and to implement new domestic standards in construction and the automotive industry. Due to efforts of the Association, imports of poor-quality wheels from China decreased by nearly half in the last year alone, a governmental plan is being implemented to stimulate the development of value-added aluminium products, a concept is being initiated and implemented to create development areas for aluminium processing (technology valleys) in several regions of the country.
'As part of cooperation between industries a huge amount of work was carried out to launch a number of major projects in the economy in which aluminium-based solutions play a major role’, says the Chairman of the Aluminium Association Valentin Trishchenko. ‘And we continue to solve new problems to move our aluminium sector forward. Russia has got great potential to increase aluminium consumption; this could primarily be achieved by introducing innovative technologies and engineering new products’.
Today, the most metal-intensive industry in Russia is construction. This trend will continue in the medium term. A significant part of projects supervised by the Aluminium Association is aimed at increasing the winged metal consumption in the construction segment. Promising areas are creating light-weight, long-span structures, applying aluminium to make facades of buildings and glass units and the widespread application of aluminium wiring.
The main obstacle limiting the application of aluminium in construction is obsolete standards: most of them have not changed in the last 20 years, and some were approved in Soviet times. Meanwhile, advanced technologies offer builders much more practical, eco-friendly and economical solutions.
Today, the Aluminium Association is working to include aluminium products in the housing renovation programme in Moscow. This programme calls for the massive demolition of old worn-down high-rise apartment blocks and building in their place new comfortable housing for more than 350 thousand people. In 2018, alone the programme calls for the construction of some 5 million square metres of new housing.
The designs for the new high-rises and the infrastructure of the new housing developments call for a whole slew of aluminium based solutions: window frames and entrance doors made from aluminium, the use of aluminium frames for balcony windows. One of the universal solutions to be used in all of the new buildings included in the renovation project is innovative ventilated facades that are to be produced from aluminium composite panels. These new facades will feature improved fire proofing and sound insulation.
We strive to ensure that the primary aluminium, which is produced in Russia, is processed by our companies as much as possible. Our objective is to increase the produceability of products and reduce the import of semi-finished products. First of all, they include plates, sheets, extrusions and accessories, i.e. the products that can be easily produced by Russian companies. We want to do our best so that the import substitution amounts to 200,000 tonnes by 2020
VALENTIN TRISHCHENKO, CHAIRMAN OF THE ALUMINIUM ASSOCIATION
'There is practically no limit to how aluminium can be used inside buildings either’, insists Valentin Trishchenko. ‘You have your suspended ceilings, and you got your walls and pillars that can be covered in aluminium sheets. Then there are recuperation units and heaters and interior doors that can be made from aluminium, and then there's indoor wiring from aluminium alloys. The list of modern solutions that use aluminium could go on and on’. The competitive edge that all these items have is longevity, environmental friendliness, energy efficiency and an affordable price. Thus, the use of aluminium products in the renovation programme meets the strategic goals of the project and can take the quality of residential housing in Moscow and in other regions to a whole new level of quality.
Another promising project supported by the Aluminium Association aims to expand the use of aluminium in greenhouse producing. The construction of new greenhouse facilities in Russia has been growing year on year and 2017 alone saw the total area of industry-grade greenhouses in Russia grow by 170 hectares. At the same time, a large portion of new structural elements and equipment needed for new greenhouses is being imported even though, domestic producers have already brought new aluminium greenhouse parts onto the market. They are 20-25% cheaper than imported analogues and not inferior in quality. Today, several Russian companies already specialise in the production of aluminium greenhouse structures that use extrusions produced at domestic extrusion facilities.
Along with greenhouses, the production of aluminium structural elements for mushroom growing facilities has also been on the rise. Until recently, these were primarily imported. The Aluminium Association projects that the next four years will see the production of such structural elements being fully localised in Russia, totalling about 4 thousand tonnes per year.
A significant increase in the consumption of aluminium is also expected in oil and natural gas production: aluminium pipes offer unique properties which are essentially indispensable in the exploration of geologically hard-to-get-to hydrocarbon deposits. At the moment, natural gas and oil companies are using some 3-4 thousand tonnes of aluminium pipes per year. However, the Aluminium Association forecasts that over the next few years they're going to be using more and more as they introduce new extraction technologies, standards and regulations, with the total consumption increasing several times.
Another area where the Aluminium Association believes there is a lot of promise is the support of import substitution programmes. These not only help to drive up aluminium consumption in the domestic market, but they also give a boost to the production of value-added aluminium products. One example is furniture production: In 2017 alone, 2.5 thousand tonnes of aluminium extrusions and furniture accessories were imported into Russia. This year, that number is expected to fall significantly: Russian produces have learned to make products that the industry needs and that offer the same quality as imports but at a lower price point.
Text: Danil KLYAKHIN