Dollar or demand: What will push up aluminum?

Rusal CEO discusses the outlook for aluminum

The price of aluminum, which has been depressed owing to a glut in the market, is set to pick up thanks to a pick-up in demand, according to the chief executive of Rusal, one of the world's biggest producers.

Vladislav Soloviev, chief executive of Rusal told CNBC at the St Petersburg Economic Forum in Russia that the metal would finish the year at around $2,000 a ton, "not far off" flat for the year.

"I hope the trend for the dollar to strengthen will change," he added. The strengthening of the U.S. dollar, the currency used to price aluminum and other commodities, has helped send many commodity prices lower this year.

The metal, which closed at $1,675 a ton on Wednesday, has averaged over $2,000 a ton since 2010. This year, Deutsche Bank analysts forecast average prices of $1,780 a ton in the second quarter, rising to $1,950 in the last quarter of 2015.

Bloomberg | Getty Images

As it costs around $1,730 per tonne to produce aluminium, according to industry analysis firm Harbor Aluminium, producers are likely to find their profits slashed.

"On one hand, we have strong demand of 6.5 percent annually on the other hand we have an unknown situation with Chinese exports," Soloviev explained.

China has recently approved quality standards for the use of low-voltage aluminum alloy-cables, suggesting that these may replace more expensive (and less available in China) copper in future electrical grid work.

Read MoreRusal earnings jumpas aluminum prices surge

"This move can be seen as part of China's drive for 'metal independence'," according to commodities analysts at Goldman Sachs.

It has also removed a 15 percent export tax on the metal, encouraging producers to sell overseas.

"The important thing is that China will grow," Soloviev said. He predicted Chinese exports will be around 4.5 million metric tons, not the 5 million metric tons some are forecasting.

Russian demand will not fall this year, as many expected, he added