Opportunity Assessment of the Aluminum and the Copper Value Chains, and Evaluation of Future Impact and Go-to-Market Strategies
On the back of the GCC's Vision 2030, aluminum demand will be driven by developments in construction, packaging, and infrastructure. The analyst recognizes that value chain integration through secondary production is an emerging trend.
Electric vehicles are gaining popularity in the region, which will drive the need to localize aluminum foil production for lithium-ion battery cell packs.
New cities are likely to be established, which will drive the demand for aluminum wire rods and conductors to connect with the power grids.
HVAC companies in the GCC are major importers of raw material feedstock, and this holds tremendous potential for new investment.
The packaging sector holds significant potential in terms of the formation of localized foil mills and the establishment of a supply ecosystem to reduce import dependency.
The region also needs to develop a scrap recovery ecosystem (closed-loop recycling) and export value-added scrap rather than mere scrap.
The GCC is a net importer of copper cathodes, wherein lies the opportunity to set up a secondary smelter and leverage the low power cost the region offers. This will also reduce dependency on imports and virgin copper metal and encourage the move to a more sustainable business model. The absence of a smelter has resulted in high copper scrap exports (about 247 ktpa).
In the downstream space, the air conditioning and the refrigeration sectors offer tremendous growth potential due to the large presence of OEMs and contract manufacturers.
Recycling initiatives are a focal point of growth and sustainability in the GCC copper industry.
