With US tariffs and China’s cap curbing aluminium production and demand drives down LME prices, will buying interest return?
US tariffs are making their presence felt across the world, dampening aluminium demand as many producers are scaling back shipments in response to increased export duties imposed on them by the United States government. As a consequence, productions are becoming limited, notably reflected in the decline of primary aluminium output in North America, attributing to narrow profit margins as well. Tariffs, often a double-edged sword, are also pushing up end-user prices burdening consumers, weakening demand further.
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In addition, aluminium production is constrained in China as it has already neared 45 million tonnes of cap, a limit imposed in 2017 to curb overcapacity. China is the world’s largest aluminium producer, including downstream and secondary. Limiting production also means restraining China’s raw material purchase, which is again reducing aluminium prices.
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US revokes 25% tariff on aluminium from UK, 10% reciprocal remains intact
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