Aluminium recycling sector must grow 25% every year to support UK industrial demand - Make UK

About UK aluminium:

• The UK’s aluminium sector supports 17,000 jobs
• £1.5 billion turnover per year
• The UK has an 81% beverage can recycling rate, higher than the wider Europe average

The Critical Mineral Strategy

• Projects aluminium demand in growth sectors will rise from 1.8Mt to 8Mt in the next decade
• Growth sectors include: defence, clean energy, digital technologies – identified in the Modern Industrial Strategy
• Aims for at least 20% of domestic critical mineral demand to be met by recycling in 2035
• The Critical Minerals Strategy can be read here.

Scrap collection, sorting and recycling opportunity - Increased domestic recycling

• Based on projected increases in recycling rates, Make UK calculates6 that to meet HM Government’s forecast aluminium demand of 8Mt in 2035, domestic industry could require as much as 6Mt of scrap available for recycling. 
• This would mean a 25% growth rate in scrap procurement year-on-year, topped up with growth in primary production. 
• If import share remains the same (18.75%), then the UK can meet this requirement by steadily reducing exports to increase retention of scrap, retaining an extra ~163Kt in 2027 and ~950Kt in 2035. 
• Exports of scrap in 2025 were ~624Kt, meaning excess retention requirements in 2033, 2034, and 2035 could be met via domestic levers such as increased post-consumer scrap procurement (achieved with the anticipated Deposit Return Scheme) and attracting scrap procurement through improved routes to market in the UK.

Scrap collection, sorting and recycling opportunity - business-as-usual, gradual UK scrap recycling growth

• In a business-as-usual scenario, with the same proportion of aluminium demand met by recycling in 2035 as is today, Make UK calculates that the absolute minimum requirement to meet 8Mt aluminium demand in 2035, is 3.55Mt of scrap.
•  This would mean a growth rate of 18% year-on-year, allowing for 6.5Mt of scrap to be retained and/or imported for recycling in 2035. 
• If import share remains the same (18.75%), then the UK can meet this requirement by steadily reducing exports to increase its retention of scrap, retaining an extra ~117Kt in 2027 and ~440Kt in 20357.

Aluminium scrap leakage

• Leakage to non-EU nations rose to 84% in the past decade:
  • 29.5Mt (2015) to 54.3Mt (2025)
  • Average increase of 7.38% year-on-year
• 2024-25 key destinations for UK-produced aluminium scrap exports:
  • India: c. 200,000t
  • Hong Kong: 107,000t
  • China: 66,500t
  • Thailand: 31,000t
  • US: 24,000t
• When the US placed renewed section 232 tariffs on aluminium imports in 2025, scrap was excluded 
  • From 2024-2025, the amount of UK aluminium scrap exported to the US increased rapidly by nearly 12 times (a 990% volume increase), from 2Kt (thousand tonnes) to almost 24Kt
  • 15Kt of this was aluminium packaging
  • Data shows a 14% increase in the first 2 months of 2026 alone.

Global market dynamics for aluminium production and scrap

• Aluminium is the third most subsidised sector in the world.
• OECD data shows that aluminium sector subsidies totalled USD 118.3 billion between 2005 and 2024.
  • Of this total, Chinese production benefited from USD 101.4 billion, equivalent to 86% of global aluminium subsidies.
  • OECD countries received USD 5.4 billion, while the rest of the world received USD 11.5 billion.
• In 2024 alone, subsidies to Chinese aluminium production reached USD 10.2 billion, representing 92% of the global total.
• China’s 14th Five-Year Plan for the Circular Economy set a target of more than 15 million metric tonnes of recycled aluminium production by 2027.
  • China has imposed a 15% export tariff to retain scrap domestically, alongside stringent import levies and regulations to support this policy.
  • China, the world’s largest aluminium producer, is now nearing its self-imposed 45Mt capacity cap.
• Aluminium scrap usage and recycling is increasingly outcompeting primary production.
  • EU secondary (recycled) aluminium production increased from 3.9Mt in 2022 to 4.8Mt in 2024.
  • EU secondary aluminium production has exceeded primary production since 2012.
• Investment in new smelting capacity outside established markets remains too weak to meet demand, increasing the risk of a global primary supply shortfall. Scrap aluminium is thus a critical material.

New EU regulations:

• A growing number of markets around the world have implemented scrap export measures, including China, Malaysia, Indonesia and Vietnam.
• The EU is expected to update its trade codes before summer 2026 to introduce aluminium scrap export limitations, as it faces its own scrap leakage challenges.
• If agreed, these measures could be in place by next year.
• The UK risks relying on a single smelter that cannot fulfil domestic demand.
• UK producers and processors could face sharp increases in scrap prices, reducing business viability.
• Without action, UK industry may be forced to rely on insecure supply chains.

Make UK recommends

1. Invest in domestic aluminium scrap sorting and pre-processing to increase capacity and capability
2. Improve collection and enforcement standards for aluminium scrap
3. Develop ‘smart scrap retention measures’ for certain aluminium alloys, designing proportionate, targeted interventions
4. Engage the EU urgently to secure UK exemption (or equivalent treatment) from aluminium product and scrap export restrictions.