22.10.202510:57:23UTC+00Aluminum Rises to 3-Year High

In October, aluminum futures in the UK experienced a significant rise, reaching $2,815 per tonne, marking the highest level in three years amid intensifying supply constraints. Key consumers are vigilant regarding the imminent scarcity in physical markets, largely due to China's impending breach of its aluminum production cap of 45 million tonnes this year under the current capacity. This situation has been further intensified by Beijing's decision to reduce the annual growth target for base metals output to an average of 1.5% for 2025 and 2026, a stark decrease from the previous 5% target. This action aligns with China's anti-involution strategy aimed at slowing manufacturing capacity expansion to manage deflationary pressures. Concurrently, Alcoa announced the closure of its Kwinana alumina refinery in Australia, citing a decline in the quality of bauxite ore. Meanwhile, long-term projections for aluminum consumption remain optimistic, buoyed by corporate commitments to invest in new data centers, which require substantial amounts of aluminum.