The aluminium industry is an extremely competitive and highly consolidated sector with six
of the largest producers accounting for over 40% of global output. This is largely explained by
the high entry barriers that are related to the specifics of aluminium production.
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| Source: RUSAL internal reporting, company’s public information |
Aluminium is the most widespread metal in nature: making up about 8.8% of the earth’s crust.
Due to its chemical reactivity, it essentially doesn’t exist in free form. Contrary to popular belief,
aluminium mines do not exist, and only a few minerals and rocks containing aluminium are suitable
for industrial production..
The process of aluminium production includes bauxite extraction, production of alumina and
smelting of aluminiun. The scarce bauxite resources have already been split among the key
aluminium producers. Moreover, the extraction of bauxites requires billions of investment.
On top of that, aluminium-producing companies need to own proprietary technologies and have
steady access to cost-competitive energy.
The world’s largest aluminium producer is Russia’s RUSAL.
The leadership in alumimiun can only be reached through an ability to provide for an entire
production cycle – from bauxite mining to the production of aluminium and aluminium-based
products.