The first half of 2025 marked a turning point for the global aluminium industry, arguably its most turbulent period in recent memory. The trigger was the United States’ imposition of steep tariffs on aluminium imports, a move that set off ripple effects across global supply chains. What began as a trade policy measure quickly escalated into a broader disruption, reshaping cross-border trade dynamics, injecting volatility into global aluminium prices, and diverging demand patterns from primary aluminium to aluminium scrap. Supported by stable supply chains, prices within a reach of USD 2,200 per tonne, and tariff exemptions, the demand for scrap has attained a new high.
Thailand emerged as a new hotspot of aluminium demand, fuelled by its expanding automotive manufacturing sector, and thus turned into a major importer of aluminium scrap replacing Malaysia. Together, these developments signal more than just a momentary shift in the global aluminium landscape; they rather reflect a deepening reconfiguration of the value chain. As H2 2025 unfolds, the following events are expected to shape industry trajectories well into the future.
Aluminium scrap – a new anchor of stability
If tariffs rocked the primary market, scrap has become the sector’s stabiliser. With sustainability goals and low-carbon production targets, countries have scaled up their use of scrap. They have ramped up their production, increased import volume, or indulged in both to meet the required amount.
Such is the United States, where aluminium scrap recovery and production are growing hand-in-hand. Until May 2024, the country recorded 269,000 tonnes of year-to-date aluminium scrap imports. By May 2025, imports had risen to 352,000 tonnes, an annual increase of 30.85 per cent, according to UN Comtrade data. In May alone, aluminium scrap imports increased 8 per cent month-on-month to 299,000 tonnes. Exports also grew by 8 per cent m/m, from 177,000 tonnes to 191,000 tonnes. Along with trade flows, US aluminium scrap recovery surged in May by 14.1 per cent m/m and 6 per cent y-o-y, amounting to 316,000 tonnes - an indicator of rising domestic demand.
However, this surge comes at a cost - largely borne by Europe. Brussels warns that the US tariff exemption on scrap is draining the bloc’s secondary metal pool, affecting domestic recycling plants, costing €40 billion in revenues, and threatening 25,000 jobs.
China, another major consumer of aluminium scrap, also saw a hike in its year-to-date imports from 248,991 tonnes to 299,554 tonnes, reflecting a y-o-y growth of 20.31 per cent. According to BIR, China’s estimated total amount of domestic aluminium scrap will reach 11.77 million tonnes by 2025, growing 13.8 per cent compared to 2020. The scrap cycle of plate, strip, and foil is relatively short, and this proportion is expected to grow from 43.3 per cent in 2020 to 44.3 per cent in 2025. The total volume of aluminium scrap with grade protection and utilisation potential is anticipated to reach 5.22 million tonnes by 2025.
Russia, known for producing low-carbon aluminium, currently recycles no more than 50 per cent of available aluminium scrap. With the government targeting an increase in domestic aluminium consumption to 1.5 million tonnes by 2030, the country will require greater use of scrap. RUSAL, one of Russia’s largest aluminium producers, has already taken steps by installing rotary furnaces to recycle consumer scrap and process aluminium slag. In addition, the company has integrated four of its smelters into a programme focused on incorporating aluminium scrap into primary metal production. The Volgograd Aluminium Smelter, a pioneer of this initiative, increased its recycling volume by 74 per cent. RUSAL has also supplied rolling slabs containing recycled content to a longstanding partner.
At the same time, due to the surge in scrap exports, countries like Europe and the United States are considering export restrictions. Should such measures take effect, they could trigger a sharp escalation in scrap prices — a new concern for producers already squeezed by energy and input costs.
Alumina slump amid supply surge
At the end of June 2025, the global alumina price on the LME stood at USD 362.14, marking a three-year low. The main reason is the expansion of production capacities in Indonesia and India. By mid-2025, Indonesia and India’s production capacities were 4.3 million tonnes and 9.43 million tonnes, respectively. Indonesia is expected to expand capacity further to 16 million tonnes within the next five years. Alumina output increased despite challenges on the bauxite front, with Guinea revoking concessions previously awarded to Guinea Alumina Corporation (GAC), a subsidiary of Emirates Global Aluminium (EGA).
Automation and sustainability advancing quietly
While market forces remain unpredictable, the industry’s twin long-term priorities — automation and sustainability — continue to advance. Leading producers are investing in digital technologies, new alloys, and circular economy initiatives to cut costs and reduce carbon footprints.
For example, RUSAL has introduced Primary Equivalent Foundry Alloys (PEFA), containing up to 40 per cent post-consumer scrap and produced with renewable energy. Another milestone is the company’s stable production of Grade A7 aluminium using inert anode technology which lowers CO₂ emissions and significantly reduces impurities in aluminium.
These examples illustrate how the industry as a whole is moving toward innovation and greater environmental efficiency, strengthening trust among customers and partners.
Shift in trade dynamics influenced by geopolitical tension
The United States’ 50 per cent tariff on aluminium triggered retaliatory measures from Canada, Mexico, the European Union, and China, reshaping global trade dynamics. Canada and Mexico, the two leading suppliers of primary aluminium and aluminium scrap to the US, were hit the hardest. Canada’s primary aluminium exports in the first five months of 2025 fell to 1.02 million tonnes, compared to 1.17 million tonnes during the same period the previous year. Nonetheless, US aluminium imports overall remained stable at 1.54 million tonnes versus 1.51 million tonnes a year ago.
So, who compensated for Canada’s decline? The United Arab Emirates increased its exports to 257,000 tonnes in the first five months of 2025, up by 73.64 per cent y-o-y from 148,000 tonnes. India also partly offset the decline, supplying 54,700 tonnes of primary aluminium compared to 27,900 tonnes a year ago.
Geopolitical tension between the West and China also reshaped supply chains. In H1 2025, China’s aluminium exports to the US fell 58 per cent y-o-y to 60,033 tonnes, compared to 143,815 tonnes the year before. In contrast, Russia’s aluminium imports from China remained relatively stable at 26,714 tonnes, down slightly from 29,842 tonnes a year ago.
Russia also relies heavily on China for alumina. In Q1 2025, Russia was the top alumina export destination for China, receiving 142,137 tonnes, up 6.9 per cent y-o-y. By July, monthly exports had exceeded 200,000 tonnes, setting a new five-year high. From January to July, China’s cumulative alumina exports to Russia reached 1.13 million tonnes.
Aluminium on the way to 2030 low-carbon goal
A report by the Mission Possible Partnership (MPP) suggests that the aluminium sector is outpacing other energy-intensive heavy industries, with 25 per cent of its 2030 decarbonisation goal either operational or having reached a final investment decision. Breaking it down, 24 per cent of low-carbon facilities are operational, 1 per cent financed, and 2 per cent announced.
Some of the world’s leading aluminium companies have invested heavily in renewable energy to power their production and significantly reduce their carbon footprints. RUSAL, for instance, has access to abundant hydropower resources in Siberia. As of 2025, the company aims to source at least 95 per cent of its electricity from hydroelectric and other carbon-free sources, already achieving more than 90 per cent renewable electricity use. Other operational low-carbon sites include Alvance Lochaber smelter (47,500 tonnes), Essen in Germany (165,000 tonnes), Neuss (5,000 tonnes), and Voerde and San Ciprian smelters with 95,000 tonnes and 228,000 tonnes capacity, respectively.
RUSAL’s novel smelting technology for producing primary aluminium reduces greenhouse gas emissions during electrolysis to nearly zero. Using hydropower, RUSAL has achieved ALLOW INERTA™ GHG emissions for Scope 1 and 2 of just 0.01 tonnes of CO₂eq per tonne of aluminium, compared to the industry average of 11.4 tonnes. In 2023, the company also achieved a 92.5 per cent recycled water use rate in the production of alumina, aluminium, and finished aluminium products.
As a result of these measures, RUSAL strengthened its position in the EcoVadis Global Supplier Sustainability Ranking, scoring 67 out of 100 points compared to 63 in 2024.
For aluminium producers, traders, and policymakers, the lesson from 2025 is clear: agility is now the defining competitive advantage. Tariffs, shifting trade routes, and price volatility will remain unpredictable. What is predictable is the inexorable march of sustainability and automation, reshaping how aluminium is made, traded, and consumed.
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