ANNUAL REPORT 2011
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2011 ANNUAL REPORT 2011
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Mission Statement “The Mission of the Aluminium Federation is to expand the market for aluminium products in the UK and to promote the interests of the Members of the Aluminium Federation.”
Contents Chief Executive’s Foreword
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President’s Foreword
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Direct Members / Member Associations/Associate Members
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Members of ALFED Council
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ALFED Committee Chairmen ALFED Staff
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Parliamentary & Public Affairs Activities
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Automotive Conference
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2011
Website / Publications / Aluminium Information Service
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Education and Training
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Health and Safety
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Climate Change Agreement
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Association Profile - ASA
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UK Statistics
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Aluminium 2012 London Olympic Torch designed by Edward Barber and Jay Osgerby
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Chief Executive’s Foreword
I appeal to our legislators to recognise industry’s needs in eliminating red tape and the burden of legislation heaped upon us by previous Governments.
Welcome to the Aluminium Federation Limited’s (ALFED) 2011 Annual Report.
I also appeal to those in the UK who make decisions related to matters of energy and climate change to recognise the damaging effect on industry of their seemingly blind ambition to lead the world in Climate Change measures. Yes, the Aluminium industry will do its bit, we already have with a 39% reduction in energy consumption since 1991, but continuing to squeeze us will inevitably lead to carbon leakage as companies close and move offshore with the loss of more manufacturing jobs in the UK.
At the time of writing this foreword, Stock Markets around the world have fallen in value with the leading industrials down by up to 20% on the same period last year. During 2010 and up to the end of Q2 this year business levels across our Associations had recovered much of the ground lost in 2008, although nearly all our Members were facing short order book horizons.
2011 Uncertainty about the financial stability of some of the EU nations and the future of the Euro has introduced yet another variable into the financial melting pot.
We have now had our “new” Government in place for 18 months. There is much rhetoric about the value of manufacturing and in rebalancing the UK economy, but we have yet to see this rhetoric turned into real and tangible support for our country’s manufacturing base.
ALFED has had another very busy year, particularly in our Political Lobbying activities, more about these later in this report. We organised a very successful Aluminium in Automotive Conference in September, again more details appear later in this report. ALFED continues to support our Members in many ways to promote the use of Aluminium through our Education programme and other events. I thank those of our Members who serve on ALFED’s Council and our other Committees, as well as the ALFED team and our advisors for the tremendous effort put in throughout the year to support our Members. This is the first ALFED Annual Report to be produced in electronic format and I hope you enjoy its content. Finally, next year ALFED celebrates 50 years since its formation. There are a number of initiatives being planned to celebrate this tremendous achievement.
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Will Savage Chief Executive - Aluminium Federation October 2011
President’s Foreword I write this Foreword as I reach the end of my two year term as ALFED’s President. I have enjoyed the role and count among my achievements the formation of a “Strategy Working Group” with the remit to look at the future direction of the Federation. One of the key findings of this working group has been the need for increased emphasis by ALFED and the ALFED team on the promotion of Aluminium. This work has already begun and activity levels will build in coming years. I am proud that ALFED has become a sponsor of Thinktank, Birmingham’s Museum of Science and Technology. Our five year agreement with the Museum will enable us to ensure that aluminium features prominently throughout the new materials gallery, which will be seen by hundreds of thousands of visitors each year, the vast majority of these being school age children and young people.
Aluminium is a material that we meet in almost every aspect of our daily lives. In fact it is a recognised fact that a nation’s wealth can be accurately assessed by its per capita consumption of Aluminium. The UK’s per capita use of Aluminium at 22kgs per person is amongst the highest in the world but is not as high as some other European nations such as Switzerland and Germany. In contrast, in India and China and some parts of South America, per capita consumption is less than 1kg. As the vast population of these regions strive for an ever better standard of living, it isn’t difficult to see that the demand for Aluminium will increase dramatically for many years to come.
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I pay tribute to the ALFED team for the effort they put in on Members’ behalf. ALFED always has punched above its weight” as a strong and effective Trade Association.
Aluminium features prominently in several of the new stadia that have been specially built for the London 2012 London Olympics, including the Velodrome and the Aquatics Centre,with their highly distinctive curved roofs. Aluminium has also been chosen for the iconic Olympics torches that will be carried throughout the UK by 8000 runners.
Colin Davies President - Aluminium Federation October 2011
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Members MEMBERS OF THE ALUMINIUM FEDERATION DIRECT MEMBERS Alcoa Europe Flat Rolled Products Befesa Salt Slags Ltd Bridgnorth Aluminium Ltd Hydro Aluminium Extrusions Ltd Novelis Europe Rio Tinto Alcan ASSOCIATIONS ADMINISTERED BY ALUMINIUM FEDERATION Aluminium Alloy Manufacturing & Recycling Association
2011 Aluminium Extruders Association Aluminium Finishing Association
Aluminium Powder and Paste Association
Aluminium Primary Producers Association
Aluminium Rolled Products Manufacturers Association Aluminium Stockholders Association The Diecasting Society
ASSOCIATE MEMBERS
Light Metals Association
Andrew Bourne & Co
Non-Ferrous Alliance
Arun Technology
Organisation of European Aluminium Refiners and Remelters - Technical Office
Cream HR
Qualanod UK Qualicoat (UK & Ireland) ASSOCIATIONS ADMINISTERED INDEPENDENTLY Aluminium Packaging Recycling Organisation
Energy Management Ltd Hallam Castings Ltd
Höganäs (Great Britain) Ltd Hüttenes-Albertus (UK) Ltd Jaguar Land Rover Morgan Motor Company PP Plasma Ltd Solios Thermal Superform Aluminium Ltd The Brock Metal Company Towergate Risk Solutions
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MEMBERS OF THE ALUMINIUM FEDERATION COUNCIL Colin Davies - President Alcoa Global Rolled Products / Direct Member Giles Ashmead Powdertech Ltd / Aluminium Finishing Association James Booth Smiths Metal Centres Ltd / Aluminium Stockholders Association Mark Brookes Aleris Recycling (Swansea) Ltd / Direct Member
ALUMINIUM FEDERATION COMMITTEE CHAIRMEN Occupational Health and Safety Trevor Smith Alcoa Building & Construction Systems Public Affairs
Simon MacVicker Bridgnorth Aluminium Ltd
Joan Chesney Novelis UK Ltd / Direct Member
STAFF OF THE ALUMINIUM FEDERATION Chief Executive
Will Savage
Henry Dickinson Norton Aluminium Ltd / Aluminium Alloy Manufacturing and Recycling Association / ALFED Immediate Past President
Tony Franchina Ann Gough Margaret Lane Tom Siddle
Rick Hindley Aluminium Packaging and Recycling Organisation
2011 Henry Ibberson Mil-Ver Metal Company Ltd / Aluminium Alloy Manufacturing and Recycling Association Brian King Anglesey Aluminium Metal Ltd / Aluminium Primary Producers Association
Accountant
Stuart Attwood
Consultants
Dr Ken Campbell Oliver Carpenter Dr David Harris Richard Mahoney Brian Thorneycroft
John McCabe Alcan Aluminium UK Ltd / Aluminium Primary Producers Association Simon MacVicker Bridgnorth Aluminium Ltd / Aluminium Rolled Products Manufacturers Association Adrian Platt Befesa Salt Slags Ltd / Direct Member
Fraser Phillips Silberline Ltd / Aluminium Powder and Paste Association Carl Tomlinson Birmingham Powder Coatings Ltd / Aluminium Finishing Association / ALFED Vice-President Derrick Webb Hydro Aluminium Extrusions Ltd / Direct Member Derek Webb Metalweb plc / Aluminium Stockholders Association / ALFED Vice-President
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Parliamentary & Public Affairs Activities ALFED continues to develop its Parliamentary and Public Affairs activities, highlighting the organisation’s important role in influencing decision makers and legislation, and ensuring that the concerns of the aluminium industry are heard at the heart of government. Three successful and well attended Breakfast Meetings, a Parliamentary Lunch and meetings of the All-Party Parliamentary Group have ensured vibrant discussions of the issues facing our industry at Westminster over the last 12 months.
F I F T Y YE A R S
2011 The Breakfast Meetings have covered a wide range of topics including Climate Change Agreements, Climate Change Levy, EU Emissions Trading Scheme, Energy Prices and Supply, Sustainability and Skills Shortage through carefully selected industry and guest speakers. Three further such meetings are planned for 2012.
ALFED’s annual Parliamentary Lunch in the House of Lords provided the ideal opportunity for the UK Aluminium Industry to highlight key issues to an audience of Parliamentarians, Senior Civil Servants, stakeholders and representatives of other trade associations.
Hosted by Baroness Gardner of Parkes, this year’s Lunch featured three speakers, ALFED’s President Colin Davies, Carl Tomlinson and Simon MacVicker who focused on the major issues of energy costs and supply, sustainability and regulatory burden. Next year’s Parliamentary Lunch will take place on the 15th of May 2012. The AGM of ALFED’s All-Party Parliamentary Group for the UK Aluminium Industry was held before this year’s Parliamentary Lunch. Anglesey MP, Albert Owen, continues as Chair, with Vice-Chairs Rt Hon Sir Alan Beith MP and Baroness Gardner of Parkes, Secretary, Lord Davies of Coity and Treasurer Lord Boswell of Aynho. ALFED continues to channel Parliamentary Questions through to both Houses of Parliament, with active and invaluable support from Members of the APPG.
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Increasingly, member companies are being encouraged by ALFED to get to know their constituency MP’s better and invite them to visit their plants so they can better understand the needs of the industry. Over the last year there have been a number of visits including Nicky Morgan MP visiting extruder Boal UK Ltd near Loughborough, and Wayne David MP and David Anderson MP visiting Hydro Aluminium Extrusion Ltd. Aside from Parliamentary activities, ALFED also continues to work closely with Government Departments and especially with the Department of Business, Innovation and Skills, HM Treasury, the Department of Energy and Climate Change and the Department of the Environment, Food and Rural Affairs.
He has a hard act to follow from the 2010 Dinner where Digby, Lord Jones of Birmingham gave an impassioned speech in support of the UK manufacturing sector. Early in 2011, ALFED lost its longest serving employee, ALFED’s Public Affairs Executive, Richard Mahoney who retired after nearly 23 years’ service. Richard continues to work on ALFED’s political lobbying activities, on a part-time consultancy basis.
2011 The annual Lunch Briefing for Senior Civil Servants from these Departments was held in October at The Goring, the hotel made world-famous in April by the Middleton family, but discovered by ALFED many years ago!
2012 will be ALFED’s 50th Anniversary and there are lots of plans to use this opportunity to promote both aluminium and ALFED to a much wider audience throughout the year, culminating in a very special Annual Dinner next November. The 2011 Dinner will also be special with our speaker Rt Hon Lord Robertson of Port Ellen, the former Secretary of State for Defence, former Secretary General for NATO and currently a senior counsellor and board member of several multinational companies.
Rt Hon Lord Robertson, Guest Speaker at the 2011 ALFED Dinner
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Aluminium in Automotive Conference September 2011 ALFED and AAMRA, the Aluminium Alloy Manufacturing and Recycling Association, held a highly-successful two-day international ‘ Aluminium in Automotive ‘ Conference featuring a number of high profile speakers.
International automotive market expert, Professor Garel Rhys CBE, gave the keynote address and Charles Morgan, owner and managing director of the world-famous Morgan Motor Company was the Conference Dinner speaker.
Held at Thinktank at Birmingham’s Millennium Point, the conference brought together the car manufacturers, academics and aluminium recyclers and casters, and outlined the current and future trends in lightweighting and recycling.
“The event gave the manufacturers, suppliers and interested bodies the chance to discuss and understand the current and future needs of each other to enable aluminium to play a key role in the future evolution of vehicles,” said Tony Franchina of ALFED, the conference’s co-ordinator.
2011 “The conference was lively and productive, enabling people working at every stage of a vehicles’ life cycle the sheer knowledge and learn better ways forward through working together.” Professor Garel Rhys CBE
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Website The ALFED website has been being analysed and assessed recently, and is to undergo a major overhaul over the next few months, improving both the useability for members and the function of promoting the use of aluminium in the UK.
Publications The ‘Props’ book has continued to sell well as a source of key information to those in the aluminium industry and downstream aluminium users.
2011 The eighteen data sheets currently available as downloads from the website, covering a range of applications and the key areas of aluminium production, have all been completely updated and reworked and can be found in the information area of the site.
Aluminium Information Service
The Aluminium Information Service continues to be well used by members and non-members alike with queries being answered on a daily basis using ALFED’s extensive library of information. Free to members, and provided at a cost to non-members, the service provides valuable technical support, particularly to SME members. The fee-based service to non-members is also a key part of our work to assist companies in the specification and use of aluminium. The charges, either ‘one-off’ or subscription based are kept at affordable levels to ensure a good uptake of the service.
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Education and Training Education and training are fundamental aspects of the role of ALFED as the UK’s manufacturing industry fights to develop the quality and calibre of its employees. As well as our regular lecture programmes run by Dr David Harris which tours the UK’s universities, there are a number of new developments coming through. The next phase of the ‘Power of Aluminium Awards’ is being managed by ALFED on behalf of the Aluminium Extruders Association. This new ‘Extrusion in Design’ Student Competition is being held during the 2011 /2012 academic year. ALFED is also providing a technical advice service through the POA website at www.powerofaluminium.com.
ALFED is also encouraging members to use the Why Aluminium? display boards and supporting booklets for display at events, educational and training establishments and anywhere that the general public can learn of the uses and role of aluminium.
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Health and Safety Health & Safety is an area of fundamental importance to ALFED and its members. Whether it is working with the decision makers in Westminster or Europe regarding the shape of new legislation or working on the shopfloor to ensure reduced injuries and sickness, the organisation is at the centre of identifying, measuring and developing solutions to improve performance. ALFED’s flagship biennial Occupational Health & Safety Workshop was held in March 2011, planned and instigated by the Health and Safety Committee.
This year the programme contained presentations on Ergonomics, Furnace Charging Practice & PPE, Management of Contractors, Drug and Alcohol Testing Policies, plus an interactive session on Dynamic Risk Assessment. Our principal speaker, Jop Groeneweg, a Dutch psychologist and international expert on the human aspects of safety, gave an inspirational address on the role of safety culture in accident prevention. Another inspiring highlight was the session on First Aid Training with the use of ‘real’ casualties using actors and very realistic make-up. Not for the fainthearted, this session bought the whole issue of First Aid Training to life.
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The speakers used at the Workshop were from our industry as well from the HSE. Feedback from delegates was overwhelmingly positive.
Trevor Smith, Chair of ALFED’s Health and Safety Committee
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Climate Change Agreement and EU Emissions Trading Scheme The collective impact of the Government’s proposed energy and Climate Change policies will significantly increase manufacturing costs, particularly for the energy intensive sector. The Treasury, assisted by BIS and DECC, is collecting evidence to justify a package of measures intended to mitigate the effect of those policies. An announcement is expected by the year-end. Coincidently, the Commons Select Committee on Energy and Climate Change is conducting an inquiry into the effectiveness of the EU Emissions Trading Scheme. In the absence of an international emissions reduction agreement, the concern is that the EU will be isolated and carbon leakage will result.
ALFED is already engaged with various civil servants, MP’s and industry committees to voice our concerns and convince the Government that industry cannot absorb the cost of additional regulation such as EU ETS Phase III, new Climate Change Agreements, Electricity Market Reform, Carbon Price Floor, CRC Phase 2 Registration, Renewables Obligation, etc.
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Association Profile The Aluminium Federation brings together the important work of a number of Associations, each representing a distinct area of the aluminium industry in the UK. Each year the Annual Report will highlight the work of one of our associations, and this year we focus on the Aluminium Stockholders Association.
Aluminium Stockholders Association (ASA) The ASA is made up of twenty full members who hold and operate UK based stockholding facilities, nine associate members who produce rolled or extruded products and seven affiliate members who supply equipment, goods or services to members. Full members act as a link between the producers of aluminium semis and the customers.
2011 At any point in time over 30,000 tonnes of aluminium stock is ready for immediate supply to any location in the UK. Extensive experience in stocking and supply ensures members can provide short lead times, small order quantities and just-intime deliveries.
Stockholders pride themselves on their ability to meet customer requirements by holding a wide range of products in standard alloys, sizes and shapes as well as special items to meet individual needs. Help with design, processing, finishing and fabrication is also offered, hence minimising costs. Members follow a strict code of conduct that ensures continuity of supply, high standards and quality. The ASA runs a successful apprenticeship scheme and is a committed supporter of the SPARKS charity. For more information visit www.asauk.co.uk
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UK Data on Wrought and Cast Aluminium Products x 1000 tonnes
INGOT PRODUCTION 600
2011 500 400 300 200 100
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Primary Smelters
Secondary Production Predominantly from Old Scrap
Wrought Remelt Production Predominantly Using Recycled Scrap From Fabrication
WROUGHT & CAST DESPATCHES 600 500 400 300 200 100
1999
2000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Bar, section and tube (excl. forging bar) Plate, sheet, strip & circles
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Castings (estimated data, allowing for non-reporting companies)
UK Data on Wrought and Cast Aluminium Products x 1000 tonnes
EXPORTS 600 500 400 300 200 100
2011 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Primary Ingot
Secondary Ingot
Extruded Products
Rolled Products
IMPORTS 600 500 400 300 200 100
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Primary Ingot
Secondary Ingot
Extruded Products
Rolled Products
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Aluminium Federation Ltd National Metalforming Centre 47 Birmingham Road West Bromwich West Midlands B70 6PY United Kingdom t: +44(0)121 601 6363 f: +44(0)870 138 9714 e: alfed@alfed.org.uk www.alfed.org.uk