Aluminium prices on the London Metal Exchange hit four-year high amid force majeure in the Persian Gulf
On Wednesday, aluminium prices on the London Metal Exchange (LME) reached $3418 per tonne, marking a four-year peak. This surge followed the announcement of force majeure and the suspension of operations at Qatalum’s plants in the Persian Gulf—a joint venture between Norsk Hydro and Qatar Aluminium Manufacturing—raising concerns over supply stability.
The blockade of the Strait of Hormuz threatens aluminium supplies from a region accounting for 23% of aluminium imports outside China. Since early January, inventories at the Malaysian port Klang have decreased by 2000 tonnes daily, while total LME stocks fell to 583,000 tonnes by the end of February, the lowest since 2020.
A significant portion of remaining stocks is Russian aluminium, representing 58% of guaranteed stocks. However, the US and the UK have banned its import in 2024, with the EU expected to follow suit this year. China faces a production cap of 48 million tonnes, with import growth slowing from 4% to 2%; by 2025, primary aluminium imports to China are projected to reach 2.5 million tonnes, including Russian metal.
