Aluminum Prices Near 4-Year Highs

Aluminum futures in the UK rose toward $3,500 per tonne, approaching their highest level in more than four years, with investors becoming increasingly cautious ahead of President Donald Trump’s deadline for Iran to agree to a peace deal. Trump said on Monday that he would not extend the Tuesday night deadline, warning that the US is prepared to strike Iranian bridges and power infrastructure if Tehran does not comply. Emirates Global Aluminium, the region’s top producer, has halted operations at its Al Taweelah smelter after it was hit by Iranian missiles last month. The Gulf region is a critical supplier of primary aluminum, accounting for roughly 9% of global supply. However, outbound shipments have been severely disrupted by the closure of the Strait of Hormuz. Signs of tightness in the physical market are also emerging, with LME warehouse inventories falling to 418,675 tonnes as of March 27, the lowest level since July 2025.

Aluminum futures in the UK dropped to $3,468 per tonne but remained near their highest level in over four years, amid fears of a more supply squeeze after President Trump provided no clear timeline on when the Iran war could end. Trump said the US is “nearing completion” in achieving strategic objectives in Iran but warned of severe military action against the country over the next two to three weeks. Emirates Global Aluminium, the region’s top producer, halted operations at its Al Taweelah smelter after it was hit by Iranian missiles. The conflict has driven aluminum prices up over 10% in March, the biggest monthly gain in nearly two years. The Gulf is a key source of primary metal, nearly all of which is exported, but shipments are now constrained due to the closure of the Strait of Hormuz. Signs of tightness in the physical market are also emerging, with LME warehouse inventories falling to 418,675 tonnes as of March 27, the lowest level since July 2025.

Aluminum futures in the UK rose near $3,450 per tonne to gain over 10% in March, the strongest performance since April 2024 amid increasing threats to supply. Output was due to fall further following Iranian strikes that damaged two aluminum plants in the Gulf region, operated by Aluminium Bahrain and Emirates Global Aluminium. Both companies have yet to provide updates on the status of their operations. The Middle East hostilities have had a pronounced impact on aluminum, given that the region is a major source of primary metal, nearly all of which is exported. Exports are now constrained due to the closure of the Strait of Hormuz. Signs of tightness in the physical market are also emerging, with LME warehouse inventories falling to 418,675 tonnes as of March 27, the lowest level since July 2025. Further supporting prices, China's factory activity returned to growth in March, signaling increased demand for industrial metals.