Japan’s Sumitomo Chemical Exits Brazilian Aluminium Refining: Focus on Business Optimization

Sumitomo Chemical

Japanese petrochemical giant, Sumitomo Chemical, has sold its 2.97% stake in Nippon Amazon Aluminium Co. (NAAC) to YKK AP, a domestic architectural goods supplier, as part of its broader business optimization strategy. With this transaction finalized on December 19, YKK AP's stake in NAAC has risen to 6.31% from 2.02%. While the financial details of the transaction were not disclosed, the move signifies a strategic shift for Sumitomo Chemical as it exits overseas aluminium refining operations.

NAAC holds a 49% stake in Aluminio Brasileiro S.A. (Albras), a Brazilian aluminium refiner renowned for producing 450,000 tons of aluminum ingots annually. Albras operates using renewable energy, making it a key player in reducing CO2 emissions in the aluminium production process. This aligns with growing global demand for sustainable and low-carbon aluminium products.

YKK AP's Green Aluminium Expansion

The deal positions YKK AP to double its aluminium ingot output, an important milestone in its efforts to procure green aluminium feedstock and decarbonize its operations. The company uses approximately 140,000 tons of aluminium annually within Japan. This acquisition is part of YKK AP's push to adopt sustainable materials and strengthen its competitiveness in the eco-conscious global market.

Sumitomo Chemical’s Broader Realignments

Sumitomo Chemical’s decision to sell its NAAC shares marks a complete withdrawal from the overseas aluminium ingot business. The company cited high profitability volatility in imported aluminium markets, largely influenced by fluctuating global aluminium prices. Earlier in the year, Sumitomo Chemical divested its shares in New Zealand Aluminium Smelters and Boyne Smelters to Rio Tinto, the UK-Australian mining conglomerate.

The company has also exited from two polypropylene (PP) compound manufacturing subsidiaries in China due to intensifying competition from local producers. Announced on December 18, this move reflects Sumitomo Chemical’s focus on optimizing its business portfolio by concentrating on more stable and profitable ventures.

Rio Tinto’s Copper, Aluminium Earnings Surge in First Half of 2024

UK-Australian mining firm Rio Tintos aluminium and copper earnings increased year on year in the first half of 2024.

Copper

Earnings before interest, tax, depreciation, and amortization (Ebitda) in Rio Tinto's copper business increased by 67% on the year in the first half to $1.8 million, benefiting from the ramp-up at Oyu Tolgoi in Mongolia and resumed operations at the Kennecott smelter in the United States following its rebuild last year.

Rio Tinto's mined copper production increased by 13% on the year to 327,000 tons in the first half of this year on the back of higher output from its three operations. Mined copper output increased by 9% on the year at Escondida in Chile and 18% at Kennecott. Mined copper output also increased by 15% at Oyu Tolgoi, keeping it on track to reach 500,000 tons per year of copper from 2028 to 2036.

Refined copper production increased by 32% on the year to 125,000 tons in the first half owing to the resumed operations at Kennecott, partially offset by lower refined copper production from Escondida by 19%.

The firm expects to produce 660,000-720,000 tons of mined copper and 230,000-260,000 tons of refined copper in 2024.

Aluminium

Rio Tinto's aluminium business saw Ebitda jump 38% higher on the year in the first six months, reaching $1.58 billion, as revenues edged up by 4% to $6.49 billion.

The company reported easing costs for key raw materials such as caustic soda, coke, and pitch. Average all-in prices remained broadly stable as rising London Metal Exchange aluminium prices were mitigated by lower premiums.

Rio produced 1.65 million tons of aluminium in the first half, up by 3% on the year, with broadly stable production across its smelter network.

The company produced 3.54 million tons of alumina in the first half, down by 5% on the year, while bauxite production rose by 10% on the year to 28.1 million tons in the first half.

In the second quarter, Rio Tinto began consolidating ownership of its aluminium smelters. At the end of May, the company agreed to acquire Japanese firm Sumitomo Chemical's stake in New Zealand Aluminium Smelters, giving Rio Tinto 100% ownership of the company. The following month, it agreed to acquire Japanese firm Mitsubishi's 11.65% stake in the Boyne Smelters subsidiary, which owns and operates the Boyne Island aluminium smelter in Gladstone.

North America lithium supply deal anchors Stardust Power–Prairie Lithium partnership

Stardust Power

A new North America lithium supply deal links Stardust Power and Prairie Lithium from 2027. The agreement secures lithium chloride feedstock from Saskatchewan for Stardust Power’s planned refinery in Oklahoma. As a result, the North America lithium supply deal strengthens regional battery material security for EV and energy storage markets.

Structuring a long-term North America lithium supply deal

The North America lithium supply deal commits Prairie Lithium to deliver 6,000 t/yr of lithium carbonate equivalent. Prairie will supply lithium chloride produced from brines in Saskatchewan’s Duperow Formation using direct lithium extraction technology. Meanwhile, initial deliveries will begin in 2027 under a six-year non-binding contract, with options for two extensions.

Stardust Power is building its Muskogee, Oklahoma refinery with a Phase 1 capacity of 25,000 t/yr. Therefore, the North America lithium supply deal will cover only part of its nameplate output, leaving room for additional offtakes. Early lithium chloride shipments can be stored on-site, supporting commissioning and ramp-up flexibility.

Building a regional lithium value chain in North America

The North America lithium supply deal fits Saskatchewan’s push to monetise subsurface brine resources. Prairie controls mineral rights over more than 345,000 acres, providing scale for future expansions. At the same time, direct lithium extraction could lower environmental footprints versus traditional hard-rock mining.

Downstream, Stardust Power is locking in long-term customer visibility through a non-binding 10-year supply agreement with Sumitomo. This dual strategy, combining upstream Prairie volumes and downstream Japanese demand, reduces project risk. As a result, the North America lithium supply deal becomes a central pillar in a cross-border value chain spanning Canada, the US and Asia.

The Metalnomist Commentary

This North America lithium supply deal underscores how brine projects and midstream refineries are reshaping regional battery raw material flows. For metal and chemical producers, the combination of secure feedstock and long-dated offtake highlights where capital will concentrate along the EV value chain.