Aluminum wins global significance and threat to copper
In the last twelve years, the price of copper has more than quadrupled. Meanwhile, aluminum has barely moved.
When it comes to conductivity, copper is the king of industrial metals. Thanks to its low-resistivity how strong a material opposes the flow of the stream-the primary use of copper is in electrical applications.
Aluminum is the biggest rival of copper, although one lower on most measures. When the price of the two metals is similar, as in early 2002, the choice of copper wiring in all sorts of things, from power lines to transmit cable car, was a breeze.
But not anymore. In the last twelve years, the price of copper has more than quadrupled from U.S. $ 1,483 per ton to U.S. $ 7,125 a ton for three-month delivery on the London Metal Exchange. Aluminum, in turn, has barely moved through vast amounts of metals. Even after the jump this year, still trades at U.S. $ 2,013 a ton.
The divergence in price has made aluminum much more attractive for electrical cables/wires. Although aluminum cables/wires need a core of more metal-dense and therefore more insulation-the weak metal prices means that the overall cost is still 40% below that of copper cables/wires, according to the French company Nexans, leading manufacturer of cables/wires. The company says that demand for aluminum cable/wire, especially in the electrical industry, is already up and that “certainly rise in the coming years”, at the expense of copper.
“There will be a replacement, and that will impact the market,” said Christophe Allain, director of corporate purchases of non-ferrous metals company in Cesco conference in Chile this year.
Source: Pulso
