The Growing Imperative of Addressing Global Climate Change
The effects of climate change have become an increasingly urgent issue in recent years, with many nations striving towards reducing emissions. Countries are working together to limit global temperature increase to 1.5 degrees Celsius, as discussed at the UN Climate Ambition Summit.
Addressing climate change challenge requires collaboration among nations to reduce carbon footprint. Several countries have already taken steps in this direction. For instance, many countries are actively transitioning to Electric Vehicles (EVs) for renewable power.
One metal is becoming more popular because of the need to fight climate change, and that metal is Aluminum.
How Can Aluminum Help with Global Warming?
Aluminum is the second most used metal after iron and steel worldwide. It holds substantial potential in the global fight against climate change. Its versatility and unique properties make it a key material aimed at reducing greenhouse gas emissions and fostering sustainability.
Here are some reasons why aluminum can help to reduce carbon emission.
Lightweight Properties
Aluminum's lightweight and durable properties make it an ideal metal for various industries.
Vehicles and aircraft commonly use it for its lightness, which saves fuel and lowers greenhouse gas emissions.
Furthermore, aluminum plays a crucial role in renewable energy technologies, such as solar panels and wind turbines. According to the International Aluminum Organization, both wind power and solar power relying heavily on aluminum to generate electricity. Solar power, in particular, requires more than four times the amount of aluminum per megawatt compared to wind energy.
Aluminum is Highly Recyclable
Although the production of Aluminum result in significant carbon emissions, but it is a highly recyclable metal. According to International Aluminum Organization, nearly 75% of all aluminum ever produced still in use today.
Recycling aluminum consumes significantly less energy compared to primary production. By recycling aluminum, energy consumption and emissions reduction makes it an more environmentally friendly choice.
Electric Vehicles
With the need for decarbonization, sales of Electric Vehicles (EVs) are surging. Human Rights Watch predicted that EV sales will increase to 12 million by 2025. To make electric cars lighter and increase their range, car manufacturers are using lightweight materials such as aluminum. Experts expect the demand for aluminum to double over the next 30 years.
Given that EVs are a critical part of the solution to help the world achieve its energy efficiency goals, aluminum is set to play a significant role in this transition.
Rise in Demands in Aluminum
As the demand for renewable energy sources continues to grow, this has led to a surge in demand for aluminum.
According to Reuters, China's aluminum imports surged by 38.9% in August from a year earlier. The International Aluminum Organization also reported that they expect global aluminum demand to increase by almost 40% by 2030.
Rising demands for aluminum typically exert upward pressure on its prices. As demand increases, the aluminum market can experience a supply-demand imbalance. This can lead to higher prices as producers adjust to meet the growing demand, potentially incurring increased production costs, especially in energy-intensive smelting processes.
Trading Aluminum Futures
Like gold futures, aluminum futures are also traded in the same few main exchanges. The exchanges are the London Metal Exchange (LME), the New York Mercantile Exchange COMEX Division (COMEX), and the Shanghai Futures Exchange (SHFE). Traders are able to trade Aluminum futures from the different exchanges through Orient Futures International Singapore.
Click to find out more about LME Aluminum Futures, SHFE and CME Aluminum Futures, including the different Aluminum futures contract specifications, the contract months and the Aluminum LME futures symbol.
Start Trading With Orient Futures Singapore
Being an Overseas Intermediary of Shanghai International Energy Exchange (INE), Dalian Commodity Exchange (DCE), and Zhengzhou Commodity Exchange (ZCE), when foreign clients participate in internationalised futures contracts in these Chinese markets with us, they have direct access to trading, clearing, and settlement. Our parent company, Shanghai Orient Futures, is the largest broker in terms of aggregated volume across the five regulated exchanges in China.
Orient Futures Singapore also currently holds memberships at the Singapore Exchange (SGX), Asia Pacific Exchange (APEX), and ICE Futures Singapore (ICE SG). Starting August 2023, corporate clients can also gain access to the B3 Exchange through us.
We provide bespoke services to our professional clients, tailored to their corporate and individual needs. Our team will be there for you 24 hours on trading days to provide a one-stop portal for all your trades, with simple processes and an intuitive user interface that has low or near-to-zero latency.
