SÃO PAULO Brazilian aluminum consumption is expected to grow at a slower rate of 3.7 percent in 2013 vs. an earlier estimate of 5 percent due to slower-than-expected economic growth, Brazilian aluminum association Abal said.
Growth in aluminum consumption is closely linked to the countrys macroeconomic performance, and Brazilian gross domestic product in the first quarter increased 0.6 percent quarter on quarter and 1.9 percent year on year. As a result, Brazils central bank cut the countrys 2013 GDP growth projection to 2.77 percent from 2.93 percent.
It was the third time in a row that the government lowered its forecast.
Aluminum product consumption in the domestic market is expected to reach 1.48 million tonnes in 2013 compared with 1.42 million tonnes in 2012, Abal said.
Domestic sheet consumption is forecast to rise 7.2 percent to 571,800 tonnes this year, while demand for cast items it set to grow 5.9 percent year on year to 220,200 tonnes, Abal said. Demand for foil and extruded products is expected to rise 4.6 percent and 4.5 percent, respectively, to 92,700 tonnes and 356,000 tonnes.
Demand for wire and cable, in contrast, is expected to fall 12.1 percent to 129,800 tonnes.
"There is lots of cable demand in Brazil," Luis Carlos Loureiro Filho, Abal coordinator of economics and statistics, told AMM sister publication Metal Bulletin. "The government has announced a program to increase electricity access, but its not going on the desired pace. When it happens, however, well require about 300,000 tonnes of wire."
As for international sales, the aluminum sector expects revenue to increase 12.6 percent this year to $4.4 billion due to a rise in alumina shipments.
First-quarter export revenue for the Brazilian aluminum industry stood at $941 million, down 8.1 percent year on year. Imports also fell 9.4 percent year on year to $310 million.