The global aluminum recycling market is set for a substantial expansion, projected to reach $91.3 billion by 2032, as industrial consumers aggressively pursue low-carbon material sources to mitigate skyrocketing energy costs and meet stringent decarbonization targets.
The forecast, detailed in a new market analysis, highlights a fundamental shift in the global metal supply chain. The recycling market, valued at $57.2 billion in 2024, is expected to expand at a compound annual growth rate (CAGR) of 6.2%.
This growth is structurally linked to the energy-saving advantage of secondary aluminum: production requires approximately 95% less energy than primary smelting.
With primary aluminum prices recently topping a three-year high of nearly $2,900 per tonne, in part due to elevated energy costs for smelters globally, the economic incentive for recycling has never been stronger.
Analysts note that persistently high electricity and natural gas prices in Europe have significantly impacted the operating rates of energy-intensive primary smelters, making recycled metal a strategic cost-saver.
In response to this structural trend, major global producers are committing significant capital to expanding recycling capacity. Novelis Inc., one of the world’s largest aluminum recyclers, is investing approximately $90 million to double the capacity for used beverage cans (UBCs) at its Latchford facility in the United Kingdom. This project is expected to increase annual UBC processing by 85 kilotonnes, which the company states will reduce annual carbon dioxide equivalent (CO2e) emissions by more than 350,000 tonnes for its European operations.
This investment is part of Novelis’ broader strategy to achieve an average of 75% recycled content across its products by 2030, up from 63% in fiscal year 2024. Novelis is also expanding recycling capabilities in North America and Asia, with CEO Steve Fisher underscoring that the focus on high recycled content directly translates into a low-carbon solution for customers. This move aligns with industry-wide initiatives, including Hydro’s recent construction of a 70,000-tonne-per-year aluminum recycling facility in Torija, Spain, designed to support the construction and transportation sectors with low-carbon alloys.
The transportation industry, particularly the electric vehicle (EV) segment, has emerged as the most critical application for recycled aluminum. The automotive sector, which already commands the largest share of the recycling market, is projected to maintain its dominance. As automakers strive to improve EV range and performance, the engineering imperative for lightweighting is increasing the average aluminum content in vehicles, which can exceed 400 kilograms per unit for some EVs.
