On March 18, the regional conflict had entered its third week, with its impact extending beyond market sentiment to materially disrupt primary aluminium smelting in several Middle Eastern countries, the report noted. For instance, on March 12, Qatalum, the 50/50 joint venture between Norsk Hydro and Qatar Aluminium Manufacturing, announced it would maintain output at around 60 per cent of capacity due to reduced gas supply, following an earlier move to implement controlled production cuts. On March 15, Aluminium Bahrain reported a 19 per cent reduction in output amid disruptions to raw material supply and transportation.

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Within the region's aluminium supply chain, alumina, a key feedstock for primary aluminium smelting, has emerged as the most vulnerable link due to the heavy reliance of Middle East smelters on imports, the report said.

Approximately 67 per cent of the Middle East's annual alumina demand is met through overseas supply, leaving aluminium smelters highly exposed to logistical disruptions. If shipping through the Strait of Hormuz does not return to normal within the next one to two weeks, continued interruptions to imported alumina shipments could trigger further production cuts across the region, Mysteel pointed out.