Upstream weekly recap: Change in investment outlook for global aluminium companies, US tariff threats, and much more

Some of the news headlines this week in the upstream aluminium industry, particularly in the primary aluminium sector, suggest a potential shift in market dynamics in the near term in the wake of aluminium price drop on alumina supply ease and proposed tariffs on aluminium imports by the US President Donald Trump. These two events in the industry have already prompted many aluminium leaders and financial analysts to revise their business strategy and market outlook.  In addition, there are some key evaluations on the 2024 aluminium production trend and market analysis to guide your 2025 planning.

RBC Capital Markets this week revised its investment outlook for Nork Hydro from “outperform” to “sector perform”, following the company’s share drop by 3.2 per cent on Tuesday, November 21, on the fear of bearish financial performance due to sluggish aluminium prices. The ease of alumina supply in the global market has raised the possibility of increased aluminium production, especially in India and Indonesia, reducing metal prices on the London Metal Exchange. RBC Capitals projects that declining aluminium prices would weigh on Hydro’s revenue as the company’s financial performance strongly correlates with aluminium prices. Read the full story here to know how the aluminium price trend influences Hydro’s earnings.  

Soon after the inauguration of Donald Trump's second term of presidential rule on January 20, 2024, the President announced his intent to impose a 10 per cent tariff on Chinese product imports, including aluminium, as early as February 1. The European Union, Mexico, and Canada may also face tariffs on their aluminium exports to the US, as Mr Trump states: "We have a $350bn [£283bn] deficit with the European Union. They treat us very, very badly, so they're going to be in for tariffs." To read the full news, click here.

Donald Trump’s tariff threat has started leading aluminium industry leaders to make fresh strategies around overseas trade. For instance, Alcoa, an American aluminium producer headquartered in Pittsburgh, Pennsylvania, is contemplating redirecting its Australian aluminium output to the United States as Donald Trump has threatened heavy tariffs on Canada. According to IndexBox, Alcoa's Canadian output of 900,000 tonnes out of the total annual production of 2.2 million tonnes serves the US market. To read more, click here.

Alcoa’s subsidiary Alcoa Inespal SL announced that it entered into a strategic agreement with IGNIS Equity Holdings, SL, the majority shareholder in the IGNIS Group, the Spanish National Government, and the Xunta de Galicia, to continue to support San Ciprián smelter's operations. They signed a Memorandum of Understanding that outlines some strategic plans to address the current issues at the smelter. To know the plans for San Ciprián’s full operations by October 1, 2025, read the news here.

China’s aluminium production reaching 44.01 million tonnes, according to the National Bureau of Statistics, has led to a projection of 45 million tonnes of output for 2025, the volume at which the Chinese government has imposed a cap. China’s aluminium production in 2024 marked an annual increase of 5.82 per cent from 41.59 million tonnes. To know more, click here.

World’s primary aluminium production in 2024 reflected an increase of 2.9 per cent from 70.716 million tonnes to 72.758 million tonnes, Westen & Central Europe, Russia & Eastern Europe, and China primarily contributed to this growth, with their individual output grown by around 4 per cent Y-o-Y. Read the news here to learn the world’s 2024 aluminium production in more details.

Platts, a division of S&P Global, has assessed a premium of $228 per tonne for Japanese primary aluminium imports in the first quarter of 2025 based on 12 trades done between December 12, 2024, and January 22, 2025, involving a total trade volume of 15,000 tonnes per month. The premium emerges as the highest since the fourth quarter of 2021 compared to $205 per tonne. For further details, click here.

According to the data fetched from the Global Aluminium Trade Monitor (GATM), in 2024, the EU's aluminium trade saw a continuation of trends from prior years, with imports significantly outpacing exports. Through October 2024, the EU imported an estimated 6,615,968 tonnes of aluminium, while exports stood at 1,677,842 tonnes. From a year-on-year perspective, both imports and exports have experienced significant fluctuations. Imports increased by approximately 11.6 per cent in 2020 (7,383,062 tonnes) and 9.1 per cent in 2021 (8,052,236 tonnes), followed by a more elevated rise of 13.3 per cent in 2022 (9,122,648 tonnes). To know more, read our market commentary on European aluminium industry.

Metlen Energy & Metals, an Athens-listed group, has asserted a substantial investment of 295.5 million euros aimed at the development of an incorporated bauxite, alumina and gallium production line. As noted in the company’s statement, the investment strategy seeks to accomplish a cumulative production ability (on an annual basis) of 2 million tonnes of bauxite, 1,265,000 tonnes of alumina (from 865,000 tonnes at present) and 50 tonnes of gallium (for the first time). All three of these substances are enlisted as Critical Raw Materials for the European Union. Read more

Press Metal Aluminium Holdings Bhd’s (KL: PMETAL), a leading aluminium smelting and extrusion facility based in Malaysia, has its fourth quarterly earnings expected to come in a range of RM 375 million (USD 83.25 million) to RM 400 million (USD 88.8 million), according to Hong Leong Investment Bank (HLIB). To know more about the projection, read here.