On Wednesday, December 3, a new market analysis projected that the global aluminum recycling market will expand significantly, reaching $91.3 billion by 2032, as industrial consumers actively seek low-carbon materials to reduce energy costs and meet stringent decarbonization targets.
The report highlights a fundamental shift in the global metals supply chain. Valued at $57.2 billion in 2024, the aluminum recycling market is expected to grow at a compound annual growth rate (CAGR) of 6.2%. This expansion is structurally linked to the significant energy-saving advantage of recycled aluminum: its production requires approximately 95% less energy than primary aluminum.
With rising energy costs at smelters and other factors recently pushing primary aluminum prices to a three-year high of nearly $2,900 per ton, the economic incentive to recycle aluminum has never been stronger.
Analysts note that persistently high electricity and natural gas prices in Europe have severely impacted operating rates at energy-intensive primary aluminum smelters, making scrap-based recycling an increasingly attractive cost-saving alternative. In response to this structural trend, major global producers are investing heavily to expand their aluminum recycling capacity.
Novelis, one of the world’s largest aluminum recyclers, is investing approximately $90 million to double the used beverage can (UBC) processing capacity at its Latchford, UK facility. The project is expected to add 85,000 metric tons of annual UBC processing capacity, reducing the company’s European operations’ carbon dioxide emissions by more than 350,000 metric tons per year. This investment is part of Novelis’s broader strategy to achieve an average 75% recycled content across its products by 2030—up from 63% in 2024. The company is also expanding its recycling capabilities in North America and Asia.
CEO Steve Fisher emphasized that the focus on high recycled content directly translates into low-carbon solutions for customers.
Meanwhile, Hydro recently commissioned a 70,000-ton-per-year aluminum recycling facility in Torrejón, Spain, designed to supply low-carbon alloys to the construction and transportation sectors.
The transportation sector—particularly electric vehicles (EVs)—has emerged as the most critical application area for recycled aluminum. The automotive industry already holds the largest share of the recycling market and is expected to maintain its dominance. As automakers strive to improve EV range and performance, lightweighting requirements are increasing the average aluminum content per vehicle, with some EVs now containing over 400 kilograms of aluminum each.
Ford Motor Company has committed to using at least 20% recycled content in the aluminum components of its F-Series trucks.
Moreover, new regulations are beginning to institutionalize this trend. Notably, the EU Battery Regulation (EU) 2023/1542 mandates minimum recycled content thresholds for battery casings starting in 2027, thereby locking in demand for recycled materials.
According to the Aluminum Association (USA), aluminum is the fastest-growing material in automotive applications, with usage per vehicle expected to reach a record 514 pounds by 2026. The International Aluminium Institute (IAI) forecasts that global aluminum demand will double by 2050, with more than half of that demand projected to be met by recycled aluminum.
