S&P Aluminum Symposium: Near-balance predicted for aluminum market in 2025

Aluminum prices will be supported by a modest surplus in 2025 before changing to a deficit in 2026.

a woman wearing a suit stands at a podium

Photo by DeAnne Toto

Aluminum prices will be supported by a modest surplus in 2025 before changing to a deficit in 2026, according to Karen Norton, principal aluminum analyst at S&P Global Commodity Insights. Norton spoke during the S&P Aluminum Symposium, Jan. 26-28 in Fort Lauderdale, Florida.

In 2024, primary aluminum posted a small surplus of 100,000 metric tons, Norton said. That surplus will decline to 32,000 metric tons this year, with a three-month London Metal Exchange (LME) price of $2,595 per metric ton predicted. The deficit will continue to grow as the decade wears on, reaching 123,000 metric tons in 2026 and 415,000 metric tons in 2027, while the LME price is predicted to increase to $2,702 per metric ton that year. That compares with an LME price of $2,458 per metric ton in 2024 and $2,290 in 2023, according to her presentation. The Platts Midwest Aluminum Premium will trend downward, from 23.2 cents per pound in 2023 to 18.7 cents per pound in 2025 before reaching 16.8 cents in 2027.

Norton said the pace of growth in aluminum will be slower in 2025 than it was in 2024, influenced by slower growth in gross domestic product (GDP) and other macroeconomic considerations.

“It's quite a muted environment, and that's essentially the picture we have for demand growth this year,” Norton said, adding that demand is tracking production, with neither growing particularly strongly.

Regarding President Trump’s threat of wide-ranging tariffs, she said S&P is taking a wait-and-see attitude “as most people” have. However, the threat has raised trade tensions and given the U.S. Midwest premium a “massive boost” to an 18-month high of more than 24 cents per pound, Norton said, as of late January. While it’s likely a negotiating tool, she said of the tariff threat, Canada accounts for 70 percent of all U.S. primary aluminum imports. When it comes to whether the tariffs have been factored into aluminum’s pricing, Norton said, “I think the general consensus is that that isn't the case.”