July 6, 2015 / 10:45 AM / 2 years ago

Japanese aluminium industry looks to bridges to spur demand

TOKYO, July 6 (Reuters) - Japan's aluminium industry will step up efforts to have the light metal used more in bridges and other infrastructure, taking advantage of new design standards to boost stagnant demand, the head of the metal's industry association said on Monday.

Aluminium costs more than traditional steel and concrete but using the lighter metal makes repair work easier, cheaper and faster as it requires less reinforcement in foundations, leading to lower maintenance cost, according to the association.

Japan's Society of Civil Engineers issued new design and production standards for aluminium structures in March, which should make it easier for the metal to be adopted as a construction material for bridges and floodgates, for example.

"We've had a major breakthrough in the infrastructure field as we've got de facto recognition by the civil engineers' society that aluminium can be used for structures," Akira Kaneko, the new chairman of the Japan Aluminium Association, told a small group of reporters.

"What we want now is to win at least one or two bridge projects this year and start building new demand," he said.

The industry is aiming to push up annual aluminium shipments including exports to 6.5 million tonnes by 2035 from 4 million now.

Japan has some 700,000 bridges across the country and more than 40 percent of them will be over 50 years old in 2023.

These bridges, built of steel and concrete, will need to be reinforced or rebuilt, and potentially that could increase annual aluminium demand by as much as 800,000 to 1 million tonnes, according to Motohiro Nabae, director at the association.

In the first instance, the industry is pushing the idea of using aluminium for separate pedestrian walkways to be added to existing bridges to increase safety, or for bridges for inspection and maintenance, as well as emergency bridges to be used at a time of natural disaster.

The industry body plans to hold talks with the transport ministry's regional offices, which set specifications for infrastructure, to spread understanding of the new standard.

Japan is Asia's top importer of aluminium and the premiums for primary metal shipments it agrees to pay each quarter over the London Metal Exchange cash price set the benchmark for the region.

Japanese premiums for July-September shipments were mostly set at a six-year low of $100 as swelling Chinese exports piled pressure on an already swamped market. Stocks held at three major Japanese ports rose for the fourteenth month in May to hit a record high of 502,200 tonnes.

Kaneko, also the head of the aluminium business of Kobe Steel Ltd, said current premiums, sharply below an April-June premium of $380, were at "appropriate" levels.

"Premiums are supposed to cover costs of freight, insurance and other things. In that sense, around $100 is a reasonable level," he said. "Future prices will depend on the volume of smelters' output and China's exports." (Editing by Alan Raybould)

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