HAMBURG Soccer's Euro 2016 could help raise demand for aluminium for beverage cans, as fans enjoy beer or soft drinks while watching their national teams, the head of Novelis, the world's largest rolled aluminium producer, said.
Past major sporting events such as the 2014 soccer World Cup in Brazil did "increase consumption of beer or other soft drinks in cans," Novelis Chief Executive Steve Fisher told Reuters.
U.S.-based Novelis supplies aluminium for drinks makers including Coca-Cola (KO.N), PepsiCo (PEP.N) and the world's largest beer brewer AB InBev (ABI.BR), according to its website.
"We certainly hope to see that same trend for the European football championships this coming summer." Fisher said, adding that Novelis is ready to meet increased demand driven by the June 10-July 10 championship in France "if it comes".
Novelis produced 3.1 million tonnes of rolled aluminium products in its 2016 financial year to end March, up 2 percent on the year with sales for transport, packaging, construction, industrial and consumer electronics in North America, Europe, Asia and South America.
And the company has recently invested in projects, including in the U.S. and Germany, which will raise capacity this year to around 3.4 million tonnes, Fisher said on Thursday.
Novelis, a unit of India's Hindalco Industries (HALC.NS), is again expanding in the automotive sector this year, but expects expanding demand also to come from drinks cans.
"Overall we are expecting healthy growth in the beverage can market, although a little bit different by region," Fisher said.
Substitution of glass bottles and steel by aluminium cans is expected to continue in Europe, he said.
"In Asia we see strong growth for beverage cans, maybe not quite as strong as we were projecting a year or two ago, but still very healthy in the five to six percent range," he said. U.S. can demand was stable.
Novelis is commissioning another automotive finishing line in its plant in Oswego in New York state to produce aluminium for Ford (F.N) as part of the company's automotive expansion.
Novelis expects a compound annual growth rate for aluminium sheet use in the automotive industry as a whole of 20 percent between 2016 and 2020, Fisher said.
The growth rate each year will partly depend on metal price levels giving automobile manufacturers extra incentives to use aluminium to cut vehicle weight.
While the strongest automotive sector growth is seen coming from North America, with China also generating interest.
"There is a lot of excitement in the Chinese marketplace, specifically around the government push for more electric vehicles over the next five years," said Fisher, adding that high aluminium content in these vehicles will increase ranges.
(Editing by Alexander Smith)
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Updated Date: May 19, 2016 22:00 PM