ericb786 :
To the casual observer, aluminum would look like it's had a strong year being up about 7% since the beginning of 2026. But dig one layer deeper and the story is really about supply disruption, not demand strength.
The war in Iran has effectively taken the Gulf countries, roughly 9% of global aluminum production, offline or at least seriously interrupted. China has also pulled back production, which has added further support under the price. In fact, of that 7% year-to-date move, roughly 3.5–3.7% of it has happened just in the last month alone, meaning the gain is accelerating, not steady, and it's tracking pretty closely with the escalation of the conflict.
Here's the thing though: wars don't last forever. And if Canada keeps redirecting more of its aluminum to Europe and Asia to avoid U.S. tariffs, I think what we'll eventually see is some of that displaced Gulf supply start flowing back to the U.S. once the region stabilizes. That's good for U.S. buyers, but it's not good news for Canadian producers — more competition for their old markets, at a moment when the price cushion that's been propping up the whole aluminum trade starts to fade.
Worth watching either way.
2026-08-06 03:37:40