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Global positivity DRIVEN by automotive change and new opportunities

A global review of the metal casting industry

The objective of the annual WFO Global Foundry Report is to provide high value information about the global casting industry, including key areas of change within each country (output trends, market strengths and current issues – be they environmental, energy or customer-focused) providing updated information from most of the main players in the global casting world.

It should be remembered that the measurement of success based on tonnage is becoming increasingly less important because of reductions in component weights and material substitutions. However, production volume is still an indication of the size of market and is used in this report in addition to ‘trend’ and ‘gut-feeling’ indications.

Continuing on a steady growth trend, casting output in China increased by 4.7 per cent in 2017 to 49.4m tons. Leading the charge thanks to the rapid growth of rail transportation, mining, metallurgical heavy machinery and construction industries, was cast steel which grew by 8.8 per cent, whilst ductile iron grew at a rate of 4.2 per cent and grey iron by 3.9 per cent compared to the previous year. The constant demand for lighter weight castings witnessed a growth in Chinese aluminium and magnesium castings of 5.8 per cent.

A 7.1 per cent increase in automotive castings output, meaning the sector now consumes 30.6 per cent of total cast components produced in China, was also bolstered by a 15.2 per cent increase in the engineering machinery sector and 14.3 per cent in rail transportation. There has been a particular increase in the production of trucks. However, Chinese foundries are conscious of the manner in which the structure of vehicles is changing, in terms of electromobility, which will impact on the sector.

As previously predicted, export of castings decreased in 2017 and the delivery value increased; note: the exchange rate factor between the RMB and US dollar in 2017. The country specifically imports a significant amount of high-end castings, with the delivery value of casting imports being five times that of casting exports.

China is continuing to work to industrial, national and international foundry standards and remains a dominant player in the global foundry industry.


Meanwhile, India continues to live up to the reputation of the fastest growing economy year on year and a positive domestic demand is further anticipated. The production of castings for 2016-2017 was approx. 11.3mt, around six per cent increase on the previous year.

The automotive sector is the largest customer base and continues to ‘drive’ demand for cast components. However, India is seeking more clarity on EV mobility to identify the future business and process development for foundries supplying the automotive sector.

Whilst the automotive sector dominates, there are also green shoots emerging in the mining, earthmoving, commercial vehicle, railways and defence industries. The Institute of Indian Foundrymen (IIF) reports that: “The automotive and capital goods industries have drawn up ambitious plans to grow three-fold in the next ten years… The Capital Goods Policy of Govt. envisages the sector to grow from a US$35 billion industry to a US$115 billion one by 2025. Whereas the automotive sector as per the Automotive Mission Plan 2016-2026 is envisaged to grow from three and a half to four times of the current value of US$74bn to US$260-300bn. Even if these plans are realised by just 75-80 per cent, it will augur well for the Indian foundry industry. The casting demand for iron and aluminium castings could grow by 35-40 per cent in the next three to four years.”

The current focus on domestic infrastructure also creates positivity for increased demand for earthmoving and associated equipment and the tractor industry grew by 21 per cent in 2016-2017 and 15 per cent in 2017-2018.

It is not just domestic demand that bodes well for the country with reports that casting exports grew significantly in 2017-2018.

There are some concerns, mainly around rising material costs, skilled manpower, good and competitively priced power, protectionism and trade wars but in general the Indian foundry sector is buoyant and is well supported by other bodies such as the IIF and government.


In the powerhouse that is the US, there is a 4.7 per cent increase in casting sales predicted for 2018 to reach US$33bn and a tonnage output of around 9.8m.

Short term (2017-2020) estimates are for an annual growth rate of 2.3 per cent with a long-term growth rate through 2026 to be in the region of 2.9 per cent.

Casting production at the 1,952 foundries is in the region of 15.2mt with a forecast capacity for 2018 of 72 per cent. The main customer bases are the automotive sector, aerospace and parts manufacturing, transportation equipment manufacturing, iron pipe, fittings, engine, turbine and power transmission, pump and compressor manufacturing and railroads.

Meanwhile south of the border in Mexico, 2017 saw an increase in production to 2.9mt and an approximate turnover of US$7.8bn. Nodular iron and aluminium diecastings witnessed the highest growth.

With a growth in casting facilities and an increase of car and truck manufacturer assembly plants in the past couple of years, Mexico is growing in stature.

72.2 per cent of casting production is destined for the automotive sector, of which 42.5 per cent is national consumption, with the remaining exports mainly destined for the US, Japan, Germany, Korea, Central America and the rest of Europe.

The number of SMEs is currently decreasing in Mexico but there is a growth in terms of large companies and global industrial groups. The number of foundries is now estimated to be around 800.


The Japanese foundry sector is continuing to recover from the natural disasters of recent years, which had a knock on effect on energy supply and prices. In 2017, casting tonnage is predicted to increase to 5.4m (2016: 5.2m). Growth has been witnessed in all alloys except copper, which has witnessed a slight reduction. Again, the automotive industry is a major consumer of Japanese castings and improvements in that sector have benefited foundries in Japan.

South Korea is coping with a gradual slowdown in economic growth of around two to three per cent. The foundry sector produces around 2.3mt of castings a year and sees the country hold tenth place in the world casting rankings. Around 90 per cent of the castings are in ferrous metals from 550 iron and steel foundries. There are also 100 non-ferrous facilities.

The country has embraced casting simulation and is continuing to gather momentum, with casting simulation companies further improving the calculation speed of software.

South Korean foundries are also of course aware of the developments in the automotive sector and are working towards electromobility. As a result, the prediction is for a particularly sharp increase in demand for aluminium and magnesium components. As host of the next World Foundry Congress (in 2020), the Korean foundry industry will be able to showcase its capabilities to the world.


Despite slow growth in 2016, the Turkish economy performed well in 2017, achieving the highest year on year growth rate in the last six years, equating to 7.4 per cent.

GDP increased by 19 per cent in 2017 at current prices but because of the increasing value of the dollar against the Turkish lira by 21 per cent, a slight decrease of 2.6 per cent was observed.

Household spending has increased, following previous socio-political concerns, resulting in strong growth all round in the last two quarters of 2017. In general a more upbeat economy led to an improved result for those in manufacturing industries.

The Turkish foundry industry ranks eleventh in the world in 2017 and accounts for 2.1mt with a value of €4.5bn. This is a 13.5 per cent increase in tonnage on 2016. There are 932 foundries of which 375 are small to medium enterprises, 395 are very small and 162 are large enterprises. Around 1.3mt of Turkish castings are exported with a value of over €3bn. Most of the production hails from privately owned companies and there are five major foreign investors – Nemak, Celik, Granul, Maxion, Federal Mogul and Schweiser.

Whilst demand in many customer bases remains stable, demand for automotive castings has increased at a greater than anticipated rate. Despite competition from neighbouring countries, new capacity investments in equipment to improve capacities and capabilities has seen Turkish iron foundries prosper. However, steel foundries have not fared so well with capacity utilisation in 2017 being at 50 per cent. It is hoped that continued investment will attract new customers. In terms of the light alloy sector, there has been more investment in high pressure diecasting technology and automotive demand is rising.

A 50 per cent rise in raw materials in 2017, compared to a decline in 2016, is a bitter pill to swallow along with a continued increase in industrial electricity prices. However, there was a slight decrease in natural gas prices. Additional energy price increases are anticipated following new legislation for Organised Industrial Zones.


2017 was a more positive year for the UK foundry industry with most sectors witnessing an increase in turnover and orders. The non-ferrous sector benefited from the continued growth of the automotive industry and the ferrous sector saw increases in orders with delivery times stretching out. Both grey iron and ductile iron production increased by ten per cent, steel and light alloy production grew by eight per cent respectively and non-ferrous production remained stable.

The UK also produces 50 per cent of the market share of investment castings from Europe.

Across the sectors, UK foundries continue to invest in new equipment and increased capabilities to improve efficiency and competitiveness. There were large increases in the costs of coke and resins, mostly because of exchange rate fluctuations.

The picture for 2018 remains positive with increased order levels both domestically and in terms of exports.

Car exports remained at an historic high level, with 1.33m shipped worldwide – 79.9 per cent of total production. The aerospace industry has improved, and the defence sector remains strong. However, offshore oil and gas projects have seen only a small recovery and continue to suffer.

In general the UK has benefitted from favourable trading conditions, but the foundry sector is conscious of the political and trade uncertainty surrounding the near future and that market conditions will be further shaped in the coming months.


There are concerns in Europe of a “closed” US market, brought about by new tariff policies which could result in more penetration into the European market from China.

However, it is generally a positive picture, with an increase in tonnage for all materials – ferrous and non-ferrous – in Germany in 2017 with foundries reaching almost 90 per cent capacity. Clausthal University of Technology reports a “boom” for the sector. Casting production grew to 5.4mt in 2017 (5.1mt, 2016) – ferrous 4.1m and non-ferrous 1.3mt.

France continues to maintain its position as an important player in the European foundry sector, producing around 1.7mt in 2017.

However, the country continues to be penalised by the import of energy supplies and industrial goods like machine tools and equipment. Despite this, French foundries prosper because of a strong knowledge base and the ability to produce a wide variety of castings.

Of concern is lack of manpower going forward which is resulting in more companies looking to automate processes and embrace changing technologies leading to Industry 4.0.

Several French foundries are recognised for a good capacity for special alloys, such as magnesium, titanium, certain grades of steel, zinc and copper, which ensures many foundries are able to differentiate themselves.

The Association Technique De Fonderie (ATF) reports that 2018 is predicted to be less buoyant than 2017 and could be a year of “transition”, however it should still be a positive year for the foundry industry. It is anticipated that a move away from diesel engine cars will result in modifications in foundries supplying the automotive sector. In addition to the continued global promotion of electromobility, the next ten years will provide some interesting developments.

It has also been a more positive time in Italy with the general economic outlook improving in 2017 to very good levels. The year also marked the fourth in consecutive growth for the Italian automotive industry and machine tool manufacturers reported a 13.7 per cent growth rate on the previous year. This along with a number of other market conditions resulted in a much improved picture for the Italian foundry sector compared to 2016.

Production volumes were increased by 7.1 per cent to 2.2mt and turnover increased by 8.6 per cent to €7m. Both ferrous and non-ferrous casting output grew, with the exception of steel castings, which dropped by 5 per cent, following a downturn in the oil and gas and mining sectors.

Capacity in iron foundries was at 76 per cent, at 80 per cent in non-ferrous foundries and just 56 per cent in steel facilities. Foreign trade was also at good levels, witnessing a 7 per cent increase in volume and 4 per cent increase in value.

There remains an optimistic outlook for 2018.

It is a similar story in Spain, although the mood is more cautious because of more moderate recovery levels in 2017 to that of Italy. Notably, production slowdown for national motorcar manufacturers in the last part of 2017 proved difficult for automotive foundries but from an overall perspective, this was compensated because of growth rates in other sectors. Thus there was a decline of 1 per cent in ferrous metals but an increase of 5.7 per cent in non-ferrous metals.

In 2017 more than half of the casting production was ductile iron and grey iron had an additional 30 per cent share. However, the move towards lightweight materials has resulted in new aluminium casting facilities being developed and existing ones increasing their capabilities so that total non-ferrous casting production is now close to 13 per cent of the total output.

Despite a good outlook, some concerns remain such as high energy costs, with Spain generally paying around 22 per cent more for its energy than the European average. Another notable worry is a need for more qualified people and the uncertainty surrounding electromobility and how this will affect the foundry sector.

There are two main challenges to Spanish foundry efficiency highlighted by Tabira Foundry Institute – the digitalisation and advanced management of casting processes and the prediction and defect control of real time production. The industry is looking to embrace predictive control systems and Industry 4.0 to solve this.

Total casting production in Austria grew by 1.1 per cent in 2017, with grey iron, ductile iron and non-ferrous production levels on the rise and steel castings still suffering from a decline in demand. Energy costs rose again as did wages and following ‘dieselgate’ those facilities supplying diesel engine manufacturers suffered. Despite this it is anticipated that the 2017 level will be maintained in 2018.

2017 was also successful for Hungarian foundries with moderate growth rates and for Romanian foundries, where the production of non-ferrous castings is high in the former and increasing in the latter, thanks to demand from the automotive sector. In the Czech Republic, 2017 signals a recovery and period of growth with many foundries reporting full capacities and total casting production increasing by 7 per cent, this is particularly rewarding as many castings are reducing in weight. Of particular note was a revival for cast iron foundries, which had previously seen decreases in production. However, 2018 shows a slower growth rate.

The Polish foundry industry currently produces over one million tonnes of castings a year, exporting around 60 per cent of these, predominantly to Germany, Italy, France, Czech Republic and the UK. The country ranks amongst the top 16 global producers of castings and eighth in Europe (fifth for aluminium castings).

There are 455 foundries of which 240 are non-ferrous, 180 are iron foundries and 35 steel foundries. They are predominantly small and medium sized enterprises, employing around 24,300 – 8,300 in non-ferrous foundries, 12,500 in iron foundries, and 3,500 in steel foundries.

During 2017 the automotive, construction and machine industries were the main customer bases.

The Polish Foundrymen’s Association also reports that from 1st July 2018 the country has been assigned as a special economic zone, which means tax exemption for up to 15 years offering a real opportunity for investment.

Belarus reported an increase in foundry production of 4.8 per cent to 259,000t and noted that increased levels of investment from various enterprises that will have a continued positive impact on the foundry sector.

Again, the need for more skilled individuals is a challenge highlighted by all of the above.

In Slovenia, foundry production grew by 2 per cent in 2017. Foundries in the country are now focussing more on higher added value castings which generally results in a reduction in weight/production volumes.

A difficult period of instability in Serbia has resulted in casting production falling to 60,000t and trading conditions continue to be problematic with a lack of materials and skilled workforce and low investment levels. Casting production is reliant on the import of all materials which can often be of insufficient quality. All these factors result in a lack of competitiveness for domestic and foreign markets. Amongst the gloom, there is a glimmer of hope with some new developments in individual foundries and an increase in the number of metallurgical students at Belgrade University.


A level of 20 per cent increase in turnover was witnessed in Finnish foundries in 2017, reaching €10.9bn. All levels of the foundry sector witnessed production increases, registering an overall increase of 24 per cent on the previous year. The value of casting production was €228m, 7 per cent more than in 2016.

A weak Norwegian krone is helping Norwegian foundries, thanks to the fact that 54 per cent of castings are exported. This bodes well for 2018 and it is hoped that the decrease in production and the number of foundries in Norway in recent years can be halted. Capacity utilisation in 2017 was around 57 per cent, which is a slight improvement on 2016.

In Sweden casting production remained stable in 2017 compared to the previous year, increasing by 2.9 per cent. The automotive industry continues to dominate, as truck manufacturers Volvo and Scania and Volvo Cars are manufacturing at an all-time high level. Scania is also set to build a new iron foundry with double the capacity and 50 per cent reduced energy consumption of the existing foundry.

Embracing the change in the automotive industry, some foundries already have parallel production lines for combustion engines and electrical.

Swedish foundries are suffering from a lack of skilled personnel and from some decline in productivity thus profitability; issues that are currently being tackled.

In Switzerland casting production in 2017 was up 3 per cent on 2016 to 53,100t and sales increased by 2.6 per cent to 595m Swiss francs. This success is accredited in part to ongoing investments in new technologies and automation and beneficial exchange rates.

Giesserei-Verband Der Schweiz (GVS) reports that Swiss foundries have very flexible working regulations operating in the country giving great scope for multi-shift operation, which has seen foundries meet tight delivery deadlines and gain competitive advantage.

Series production in Swiss foundries grew in 2017 and there were good sales to Europe, China and North America. The major increases were seen in the supply of complex cast parts, specifically for the automotive sector.

Continuing growth rates are expected for 2018, although uncertainty around tariffs when supplying the US are expected to have an impact which is why Swiss foundries are working towards developing pan-European/global added value networks.


The foundry industry in South Africa continues to come under severe pressure because of an inability to compete internationally. The greater number of exports has resulted in reduced volumes for South African foundries and lower asset utilisation. The challenge of increased electricity tariffs, exchange rates eroding margins, skills shortages and regulatory compliance are all impacting profitability.

Egypt too is suffering from a decline in production to around 200,000t in 2017 and a lack of strategic investment has played its part in this.

This report is compiled by Foundry Trade Journal editor Lynn Postle from data sourced from the WFO Global Foundry Report 2018 and is therefore based on information provided by member countries. There are some notable absences – Russia and South America plus Indonesia and parts of Asia. This is because those regions are either not members of the WFO or have not submitted a report. It is difficult to “second guess” the situation in those parts of the world, which means this is not a definitive report but more a snapshot of what we know at the current moment in time.

More detailed statistical information will be published by the American Foundry Society in the AFS World Casting Census in December.