Global Aluminum Prices Hit Four-Year High, China's Aluminum Exports May Set Historical Record

The escalation of the situation in the Middle East has led to supply disruptions and gaps in the international aluminum market, with aluminum prices on the London Metal Exchange reaching a four-year high.

Currently, the premium of London aluminum prices over Shanghai futures aluminum prices has widened to the highest level since March 2022. This domestic and international price difference is stimulating a large-scale outflow of Chinese aluminum materials. Due to domestic economic slowdown and limited consumption, the high overseas premium is becoming the main channel for digesting domestic production capacity.

Bloomberg data shows that China's aluminum export volume increased by 15% to 598,000 tons in April this year, hitting a record high since November 2024. Analyst Zhu Liangmin from the consulting firm Beijing Aladdiny Zhongying Business Consulting Co. estimates that China's aluminum export volume is expected to break through 680,000 tons and reach a historical high in the coming months. Among them, the demand for grid aluminum rods and alloy aluminum materials used for car wheels, which are unaffected by the tightening of export tax rebates, is particularly strong.

As the world's largest producer of aluminum, although China's market prices have been driven up by the international market, there has been no substantive shortage domestically. Processing enterprises in production hubs such as Henan are operating at full capacity to deliver overseas orders, especially deep-processed products like ultra-thin battery foil. Management at the manufacturing company Henan Mingtai Aluminum Industrial Co. confirmed that the company's overseas sales volume has made a significant leap in the second quarter.

Another factor in the rise of international aluminum prices is the market's concern that Chinese smelters may be forced to cut production due to energy consumption and emission reduction targets. This expectation of tightening supply in China has pushed up overseas futures aluminum. In addition, driven by the oil price surge triggered by the Iran war and the demand for artificial intelligence, China's industrial enterprise profits in April also achieved the fastest growth rate in two years.