What is the Canadian aluminum industry?

Canada is the world's third-largest aluminum producer (after China and India), with about 3 million tonnes of primary aluminum smelted annually. More than 90 per cent of Canadian aluminum production occurs in Quebec, where the abundant low-cost hydroelectric power supplied by Hydro-Québec makes the energy-intensive smelting process economically competitive. Aluminum is one of Canada's largest single export commodities, contributing about $9 billion to Canadian GDP and supporting more than 11,000 direct jobs.

The major Canadian aluminum producers are Rio Tinto Aluminium (which acquired Alcan in 2007 for $38 billion), Alcoa, and Aluminerie Alouette. Rio Tinto operates seven smelters in Quebec, mostly in the Saguenay-Lac-Saint-Jean region (Arvida, Laterrière, Grande-Baie, Alma, and AP60), plus the Kitimat smelter in British Columbia, and the Becancour smelter (50 per cent owned by Rio Tinto). Alcoa operates two Quebec smelters, Baie-Comeau and Deschambault. Aluminerie Alouette in Sept-Îles is one of the largest single aluminum smelters in the Americas.

The industry's competitive advantage rests on hydroelectric power. Aluminum smelting consumes about 14 megawatt-hours of electricity per tonne of aluminum, making Quebec's roughly 4 cents per kilowatt-hour industrial rates a major competitive advantage. Hydro-Québec sells about 25 per cent of its industrial output to aluminum smelters under long-term contracts. The Saguenay-Lac-Saint-Jean region's identity is shaped by aluminum, with Arvida (the historic Alcan company town) preserved as a National Historic Site since 2012.

Canadian aluminum has the lowest carbon intensity of any major producer globally because of its hydroelectric power source. The industry has committed to net-zero emissions by 2050 through electrification of remaining processes, the ELYSIS inert-anode technology being developed jointly by Rio Tinto and Alcoa with federal-provincial support, and aluminum recycling. The 2018 U.S. Section 232 tariffs and ongoing dumping concerns from Chinese producers are recurring trade issues. The Aluminium Association of Canada represents the industry.