The Norwegian aluminium company Norsk Hydro will not be allocating any further capital to its battery materials or green hydrogen technologies activities. Both business areas are to be "phased out" in response to "challenging market conditions", the company announced at an investor day held at the end of November.
Hydro now plans to accelerate its alignment with the 2030 strategy it released last year and shift its strategic focus to more promising growth areas of aluminium recycling and the production of aluminium extruded profiles.
Nevertheless, Hydro said that it would remain involved as an industrial owner of Hydrovolt, a battery recycling joint venture that it founded in 2022 together with Swedish battery manufacturer Northvolt. At the beginning of November, Hydro had increased its stake in the project from 50 to 62 per cent. Northvolt subsequently filed for Chapter 11 bankruptcy protection and withdrew from the financing of the joint project, leaving its Norwegian partner as the only party financially backing Hydrovolt's continued development.
The Norwegian group reaffirmed earlier targets set for its aluminium recycling business. The company announced its intention to increase its recycling of post-consumer aluminium scrap to between 850,000 and 1.2 million tonnes per year by 2030. Hydro said that it is on track to reach this goal and expects to achieve a capacity of 700,000 tonnes of post-consumer scrap by the end of 2024. If all the projects in the pipeline are implemented, the group's output would fall within the lower end of the 2030 target range.
At the same time, the company's Aluminium Metal and Extrusions recycling hot metal costs are to be reduced by $20-30 per tonne by 2030. Together with growth initiatives and synergies from the acquisition of Polish recycler Alumetal, these measures are to contribute up to NOK5bn (approx. €425m) annually to the result of the recycling activities, according to Hydro.
Revenues from the sale of the group's "Hydro Circal" recycled aluminium product, which has a recycled content of at least 75 per cent, are also expected to continue to grow. Circal sales volumes are expected to increase by 20 per cent or 60,000 tonnes in 2024, despite weak markets in Europe and North America.
"Our 2030 strategy is clear and we are steadily delivering on our ambition to pioneer the green aluminium transition. We are driving growth in aluminium recycling, extrusions and renewable energy, further supported by our commitment to a broader sustainability agenda," said Hydro's CEO Eivind Kallevik.
