Aluminum Hits 5-week High

Aluminum futures in the UK rose above $3,210 per tonne, the highest level in nearly six weeks, amid ongoing supply constraints and slower production. Output outside China fell 6.7% year-on-year in July, mainly due to reduced operating rates at several Middle Eastern smelters. These pressures were compounded by China’s 45 million-ton production cap, which is expected to become more restrictive this year. Geopolitical tensions have also prompted consumers to draw down exchange inventories, with LME stocks falling to their lowest level this century. In addition, Alcoa Corp. cut its production forecast following operational issues at an Australian refinery. However, some of these supply concerns could be offset by anticipated capacity restarts and expansion progress among producers, including the restart of the Slovalco smelter in Slovakia in Q4 of 2026 and Metals’ Missouri smelter by year-end. Emirates Global Aluminium also continued restoring production at its Al Taweelah facility.

Aluminum increased to 3216.00 USD/T, the highest since June 2026. Over the past 4 weeks, Aluminum gained 3.19%, and in the last 12 months, it increased 25.18%.

Aluminum futures in the UK hovered around $3,180 per tonne, holding their rebound from a four-month low of $3,085 reached earlier in July, amid rising supply risks and tightening inventories. The US and Iran have intensified attacks since an interim ceasefire deal signed last month collapsed, with shipping traffic in the Strait of Hormuz largely stalled, indicating little prospect of a return of aluminum supplies from the Persian Gulf, which accounts for around 9% of global supply. This has added to supply constraints, as China’s 45 million-ton production cap is set to become more restrictive this year. In addition, inventories in LME warehouses remained at their lowest levels since 2022, while Shanghai Futures Exchange stockpiles continued to decline, pointing to sustained demand. Meanwhile, the restart of Emirates Global Aluminium’s Al Taweelah alumina refinery following a three-and-a-half-month outage could provide some relief.