Middle East crisis jolts aluminium downstream trade; end-use sectors grapple with supply crunch

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The global aluminium downstream sector is witnessing a sharp realignment as Middle East supply disruptions, uneven corporate earnings, expansion investments and changing trade flows reshape market dynamics. While producers navigate rising aluminium prices, shipment costs and operational setbacks, demand from packaging, aerospace, EVs and recycling continues to influence long-term growth strategies across key regions.

Financial performance and corporate moves

Shyam Metalics and Energy Limited reported a strong Q4 FY26 performance, with profit after tax rising 42 per cent year-on-year to INR 3.12 billion, backed by higher sales volumes, stronger realisations and improved operational efficiency across its aluminium foil, steel and speciality alloy businesses. Quarterly revenue climbed 27 per cent to INR 52.4 billion, while EBITDA increased 33 per cent. Riding on the momentum, the company has also unveiled a major INR 27 billion expansion plan including aluminium projects, pointing to a robust long-term growth strategy despite a volatile global metals market. 

Explore the accurate insights and forecasts for the aluminium flat rolled products (FRP) market in Aluminium Flat Rolled Products: Insights & Forecast to 2032

Maan Aluminium reported a weaker Q3 FY26 performance, with net sales slipping to around INR 1.52 billion and profit after tax falling nearly 27 per cent below the previous four-quarter average. Despite pressured margins, subdued export demand and slower inventory movement, the company maintains a relatively firm balance sheet. Continued optimism prevails with long-term investor confidence remaining intact, as the stock has delivered robust multiyear returns, including gains of over 180 per cent in three years and more than 580 per cent over five years. 

Weekly aluminium downstream and end user recap by AL Circle Pvt Ltd

Novelis reported a weaker FY26 performance after two fires at its Oswego, New York facility disrupted production, reducing shipments by an estimated 145 kilotonnes and impacting Adjusted EBITDA by around USD 104 million. Its FY26 net loss was USD 15 million, down from USD 683 million Y-o-Y, while FRP shipments dipped 5 per cent to 3.56 million tonnes. Nonetheless, Novelis remained optimistic about long-term low-carbon aluminium demand and expects the Oswego hot mill restart soon, while continuing commissioning work at its new Bay Minette recycling and rolling facility in Alabama.

Soon after, Novelis announced its Oswego plant in New York is expected to resume production within the next few weeks. The company had earlier expected the restart to take place by the end of June, but commissioning activities are now progressing faster than previously estimated. The Oswego facility experienced two separate fires in September and November 2025. The incidents were contained to the hot mill area, and no injuries were reported; all employees were evacuated safely during both events.

Asian private equity firm MBK Partners is set to acquire Altemira Holdings Corporate, the Japanese aluminium can producer, in a deal valued at around YEN 117.5 billion (USD 760 million), according to industry sources. The acquisition involves MBK Partners acquiring 100 per cent of Altemira from US-based investment firm Apollo Global Management. Altemira is the second-largest aluminium can manufacturer by market share in both Japan and Vietnam, with annual revenue estimated at approximately YEN 200 billion (USD 1.29 billion).

Middle East conflict tightens the supply chain

The Middle East conflict has removed an estimated 2.3–3 million tonnes of GCC aluminium capacity from the market after shutdowns at EGA, Alba and Qatalum, while disruptions through the Strait of Hormuz continue to strain raw material flows and exports. With the Gulf accounting for roughly 9 per cent of global aluminium supply and a major share of imports into the US, EU and Asia, downstream sectors are facing rising costs, shipment delays and tightening metal availability.

Surging aluminium prices driven by the Middle East conflict, fuelled by a tax gap across the Strait of Hormuz, have prompted Chinese producers and traders to ramp up supply of aluminium in processed or semi-fabricated form rather than as ingots. China exported 15,565 tonnes of aluminium stranded wire, cables and related products in April. The volume marked a jump of more than 166 per cent year-on-year and nearly 95 per cent higher than March levels.  

The aluminium packaging sector, which consumed around 16.70 million tonnes in 2025 and is projected to approach 17.16 million tonnes in 2026, is now confronting the risk of losing 3-3.5 million tonnes of aluminium supply this year. Packaging industries across Asia, Europe, the United States and Brazil are coming under mounting pressure as escalating tensions in the Middle East threaten to disrupt raw material supply chains. Consequently, packaging companies are increasingly diversifying procurement strategies, expanding recycled aluminium use and reducing dependence on single sourcing regions. Find out more.

In a move to offset aluminium and freight costs due to the ongoing Middle East conflict, California-based beverage company Monster Beverage may raise its product prices incrementally through 2026. Executives noted that aluminium prices and freight expenses increased during Q1, partly owing to tariffs and the Middle East geopolitical tension-induced supply disruptions. However, the company believes this move would not affect the consumption pattern of energy drinks, following their previous experience when the market remained resilient even after they increased prices.

Coca-Cola’s Diet Coke is gradually returning to stores in India after weeks of supply shortages triggered by disruptions in aluminium can availability, though consumers are now facing significantly higher prices and a switch in packaging. Tensions in the Middle East, particularly in the Gulf regions, caused shortages in the supply chain, particularly in the shipping routes connected to the Strait of Hormuz. Retailers say pricing and supply conditions may remain volatile until aluminium availability and shipping routes linked to the Gulf region stabilise more fully.

Demand trends, trade shifts and market outlook

The North American aluminium market has witnessed sharp shifts in trade dynamics, the trend shifting with policy changes and geopolitical developments. In 2025, North America’s aluminium market showed signs of recovery, with demand ending the year on a stable note despite economic and trade-related headwinds. According to the latest Aluminium Situation report by the Aluminium Association, the region recorded a modest 0.8 per cent increase in aluminium demand, backed by stronger manufacturing activity in the second half of the year after a weak start. Learn more.

Japan’s primary aluminium imports increased by 6.6 per cent year-on-year and 16 per cent month-on-month to 89,497 tonnes in March 2026, supported by improving automotive demand and higher domestic production of aluminium products. Data from Japan’s Finance Ministry showed stronger activity in flat-rolled and extruded aluminium products during the month, while vehicle production also continued to recover. However, demand from the construction sector remained weak due to lower housing activity.

Constellium SE and Ryerson Holding Corporation are drawing investor attention as aluminium prices remain elevated amid global economic uncertainty and trade tensions. Strong demand for lightweight electric vehicles, recycled aluminium, rechargeable batteries and aerospace applications continues to support aluminium consumption globally. Healthy air travel activity and rising aircraft production are also boosting demand for aluminium alloys used in fuselages and wings.

Projects, Technology and Regulatory Developments

Texarkana Aluminum has rolled its first coil after commissioning a major hot mill expansion project at its Texas facility, featuring a new four-stand hot tandem mill supplied by Mino. The project began in 2023 after Mino received a contract to design, supply, and commission the mill. The new equipment was installed as an extension to the existing single-stand reversing hot mill, converting the plant into a “1+4 Hot Rolling Line”. In this setup, the older mill acts as the roughing stand, while the four new stands are used for hot finishing.

ROLEC has launched the profiCASE, a new line of diecast aluminium enclosures aimed at protecting in-cab control systems used in sectors such as agriculture, construction and heavy engineering, where electronic control systems need extra durability and environmental protection. The new profiCASE range is designed for human-machine interface systems, commonly known as HMIs, which are increasingly used for touchscreen controls and electronic operations inside off-highway vehicles.

Australia has concluded its latest anti-dumping review on Malaysian mill-finish aluminium extrusions, retaining duties on certain producers while removing trade measures on another manufacturer. Under the decision, which will take effect from June 3, 2026, LB Aluminium will continue to face a floor price arrangement, while Milleon Extruder remains subject to an anti-dumping duty rate of 3.4 per cent. However, Australia decided to discontinue duty collection against Kamco Aluminium. Capral Limited filed an application for the recent review in June 2025. Read more here. 

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