News
Chevron right
Transparency in a turbulent market: aluminium update

20 March 2026 Jaco Steehouwer

Transparency in a turbulent market: aluminium update

Aluminium market update

The aluminium market is currently in an exceptionally turbulent phase.

Due to a combination of geopolitical tensions, logistical disruptions and structural market shortages, global availability has come under pressure and aluminium prices have risen sharply. We would like to take this opportunity to inform you about the situation and the potential consequences for prices, delivery times and availability.

Geopolitical situation: war in Iran and blockade of the Strait of Hormuz

The recent escalation of the conflict between the US/Israel and Iran has direct consequences for the global aluminium supply. The countries of the Gulf Cooperation Council (GCC) – including Qatar, Bahrain and the UAE – produce over 6.2 million tonnes of aluminium annually, more than 80% of which is exported via the Strait of Hormuz.

This crucial shipping route has been virtually blocked by the war, resulting in:

  1. raw materials such as bauxite and alumina failing to reach smelters on time;
  2. exports of finished aluminium being severely delayed or halted;
  3. ships having to sail around the Cape of Good Hope, resulting in higher costs and longer transit times.

Several producers have already had to cut back production. For instance, Aluminium Bahrain (Alba) has shut down 19% of its capacity, whilst Qatalum is operating at around 60% due to restrictions on gas supplies. Further production cuts in the region are expected.

Sharp price rises worldwide

The market is reacting strongly to these disruptions:

  1. The LME aluminium price rose by more than 10% in a matter of days to its highest level in four years.
  2. Regional premiums have risen sharply:

Rotterdam: +33%
US Midwest: +8% (on top of already record-high levels)
Asia: +70%

These rises are likely only a precursor to further increases if the blockade of Hormuz persists.

 

 

Structural market shortages are exacerbating the impact

The market was already tight before the war due to:

  1. China’s production cap of 45 million tonnes per year for primary aluminium;
  2. high global energy prices;
  3. limited restarting of smelters in the EU and the US;
  4. rapidly rising demand from, among others, electric vehicles and renewable energy.

The current geopolitical crisis is exacerbating these structural shortages and creating a risk of a period of reduced aluminium availability.

Consequences for our customers

Although we actively manage our stocks and supply chain, we cannot fully neutralise the impact of these exceptional circumstances.

It is therefore important to bear the following in mind:

  1. Price increases are inevitable. Due to extreme volatility, we issue quotations with limited validity, based on the LME and exchange rates at the time. Our prices will be updated based on these rates at the time of order, if necessary.
  2. We discuss large orders in advance to ensure we can continue to guarantee our service levels and delivery reliability.
  3. Logistical delays may occur due to limited transport capacity and longer transit times.

Moving forward together

We understand that these developments are impacting your business operations. We therefore believe transparency is essential. We will continue to monitor the situation closely, and you are welcome to contact us at any time to enquire about the current state of affairs.