The global aluminum market is experiencing a significant price increase amid recent Iranian attacks on the metallurgical facilities of the largest producers in the Middle East. Experts point to serious risks for the stability of aluminum supply.
This is reported by Finway
Increase in Exchange Quotations
Aluminum futures for delivery in three months on the London Metal Exchange (LME) were trading at $3432.5 per ton as of 11:10 Kyiv time. This is 4.1% higher than in the previous trading session. During trading, the price rose to $3492 per ton — the highest level since March 19 and close to a four-year high of $3546.5 per ton.
On the Shanghai Futures Exchange, prices for the most active contracts increased by 3.43% at market close on Monday, reaching 24,725 yuan ($3578.82) per ton.
Impact of Attacks on Production and Logistics
Last Sunday, Aluminium Bahrain (Alba), which operates one of the largest aluminum plants in the world, reported an assessment of the damages caused by Saturday’s Iranian strikes on its production facilities. Another leading producer, Emirates Global Aluminium, also suffered significant damage due to missile and drone attacks on the Khalifa economic zone in Abu Dhabi.
The escalation of the situation related to the U.S. and Israeli war against Iran has raised concerns about supply disruptions in the global aluminum market. Gulf countries account for about 9% of the global metal supply. Due to the attacks, supplies through the Strait of Hormuz are under threat, and Alba has already begun to reduce production, which could further complicate the situation.
“Attacks on facilities increase the likelihood of prolonged supply disruptions,” states a report by ING Economics analysts. “Supply issues may persist even if geopolitical tensions ease, raising the risk of price increases.”