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Norway’s Hydro has signed a landmark €1 billion aluminium wire rod supply deal with Danish power cable firm NKT. The agreement will provide NKT with 274,000 tonnes of low-carbon aluminium wire rod from 2026 to 2033, with options for additional volumes. This deal reinforces Hydro’s strategic role in the electrification of Europe’s energy infrastructure.
Supporting Europe’s Grid Expansion with Low-Carbon Aluminium
The Hydro aluminium wire rod supply deal supports NKT’s efforts to scale up production of medium and high-voltage power cables. These products are essential to meet rising demand for renewable energy transmission. Hydro will further strengthen its supply capability through a new 110,000 t/yr wire rod casthouse at its Karmoy facility in Norway.
Diversifying with Automotive Foundry Products and Sustainability Goals
Hydro also signed a letter of intent with Mexico-based Nemak to co-develop ultra-low carbon aluminium foundry alloys for the auto sector. The goal is to deliver aluminium with a CO₂ footprint under 3kg per kg—25% lower than Hydro’s current best offering. This aligns with Hydro’s long-term strategy to decarbonize across the entire aluminium value chain.
Strong Profits but Demand Concerns for 2025
Hydro reported a 76% year-on-year rise in Q1 core profit, driven by stronger aluminium and alumina prices and favorable currency shifts. However, the company lowered its 2025 EBITDA guidance for the Extrusions division due to demand uncertainty in Europe and North America, citing US tariff policy concerns.
The Metalnomist Commentary
The €1bn Hydro aluminium wire rod supply deal reflects growing momentum in Europe’s low-carbon infrastructure buildout. However, Hydro's cautious 2025 outlook highlights the tension between green investment trends and macroeconomic volatility.
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