The ongoing Middle East conflict has led to 40 per cent of London Metal Exchange (LME) aluminium inventories being cancelled or marked for delivery. Several industry sources stated that the cancellations are linked to supply disruptions caused by the closure of the Strait of Hormuz. 

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On March 10, 2026, Monday, LME data showed that about 98,150 tonnes of warranted aluminium were cancelled in the warehouses of Port Klang, Malaysia. Last week, another 45,000 tonnes were withdrawn from the same warehouses. 

Also Read: Middle East conflict: Barring India’s crude oil import, fuelling food crisis and aluminium shortage?

Total LME stocks now stand at 452,375 tonnes – the lowest since July. Meanwhile, about 39.5 per cent of the exchange’s aluminium inventories have been designated for delivery.

The market structure has moved into backwardation, with cash aluminium commanding a USD 59 per tonne premium to the three-month contract. This marks the highest premium since February 2022, when Russia launched its invasion of Ukraine.

Amid the prolonged crisis, Gulf smelters Qatalum and Aluminium Bahrain have declared force majeure, leaving them unable to supply clients. With stocks declining and key supply routes blocked, pressure on the aluminium market continues to intensify.

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