The growth of construction industry coupled with the rising automotive industry are significantly boosting the Indonesia aluminium market growth.

According to the new research report by Next Move Strategy Consulting, the Indonesia Aluminium Market was valued at USD 2.5 billion in 2023 and is predicted to reach USD 4.8 billion by 2030, with a CAGR of 9.2% from 2024 to 2030.

The growth of Indonesia's construction industry is a key driver of the aluminium market. Significant investments in infrastructure projects, such as roads, bridges, and airports, are increasing the demand for aluminium due to its versatility in construction. This surge in construction activities is prompting local aluminium producers to expand their production capacities to meet the rising demand. 

In 2023, the construction industry contributed 9.86% to Indonesia's Gross Domestic Product, making it the fifth-largest sector in the national economy, as reported by the Government of Indonesia. This substantial contribution highlights the crucial role of the construction industry in fueling the growth of the Indonesia aluminium market.

Also, the growth of Indonesia's automotive industry is significantly boosting the aluminium market. Automotive manufacturers are increasingly using aluminium to produce lighter, more fuel-efficient vehicles, driving up demand for the metal known for its lightweight and high-strength properties.

In response, local aluminium producers are expanding their production capacities to meet this rising need. According to the International Organization of Motor Vehicle Manufacturers, Indonesia motor vehicle production increased from 890,000 units in 2021 to 1.18 million units in 2023, enhancing the country's competitiveness in the global market.

However, the environmental concerns are significantly restraining the growth of Indonesia aluminium market by imposing regulatory constraints and increasing production costs. The energy-intensive nature of aluminium production results in substantial greenhouse gas emissions and environmental degradation. 

To mitigate these impacts, the industry must comply with stringent environmental regulations, requiring investments in cleaner technologies and compliance measures, which elevate operational costs. Additionally, heightened environmental awareness among consumers and stakeholders’ pressures companies to adopt sustainable practices, potentially slowing expansion and production activities. These factors collectively hinder the industry's growth and competitiveness in the market.

On the contrary, the integration of Artificial Intelligence (AI) in sorting mixed aluminium alloy scrap offers a significant opportunity for Indonesia aluminium market growth. Traditionally, sorting aluminium alloy scrap has been labor-intensive and time-consuming, requiring considerable human resources.

By leveraging AI algorithms and machine learning techniques, Indonesian scrap merchants and smelters can streamline this process. AI systems can quickly and accurately identify different aluminium alloys, separating them based on composition and purity requirements.

This automation will not only reduce the time and labor costs associated with manual sorting but also improve the overall efficiency of aluminium recycling operations. By ensuring that only high-quality aluminium scrap is used for recycling, AI-enabled sorting systems will help produce pure aluminium products that meet the stringent quality standards demanded by various industries. 

Furthermore, the adoption of AI in aluminium scrap sorting will enhance the sustainability of Indonesia aluminium market by promoting resource efficiency and reducing waste. Maximizing the utilization of recycled aluminium and minimizing impurities in the manufacturing process, AI-driven sorting technologies will contribute to the circular economy and environmental conservation efforts.

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According to the report, leading key players operating in the Indonesia aluminium market include China Hongqiao Group Limited, PT Indonesia Asahan Aluminium (Inalum), PT. Daiki Aluminium Industry Indonesia, PT. ALEXINDO (Aluminium Extrusion Indonesia), PT Alumindo Light Metal Industry Tbk, PT Alakasa Industrindo Tbk, PT Indal Aluminium Industry Tbk, Hindalco Industries Ltd., East Hope Group Company Limited, PT Indoaluminium Intikarsa Industri, and others.

For instance, in January 2024, Inalum launched two significant aluminum-related projects. One project involves building an aluminum smelter in West Kalimantan with a production capacity of 1 million metric tons per year, while the other focuses on developing a bauxite mining and refining complex in North Kalimantan.

Also, in March 2022, East Hope Group initiated Phase 1 of its new energy material project in Ningxia, China. This launch reflects East Hope Group's commitment to advancing energy materials, including aluminium-related technologies. 

The introduction of Phase 1 highlights the company's proactive approach in driving innovation and contributing to the development of new energy materials, showcasing their pivotal role in shaping the future of energy-related industries.

Key Insights from the Indonesia Aluminium Market Report:

• The information related to key drivers, restraints, and opportunities and their impact on the Indonesia aluminium market is provided in the report.

• The value chain analysis in the market study provides a clear picture of the roles of each stakeholder.

• The market share of the players in the Indonesia aluminium market along with their competitive analysis are provided in the report.