Interruptions in the supply of aluminum from the Middle East and increased demand will contribute to an increase in metal prices until the end of the year, analysts expect. According to their forecasts, quotes will stabilize from 2027, but will remain above the levels of 2021–2025. Rusal, which accounts for more than 5% of global aluminum production, does not expect the effect of high prices due to the strong ruble and rising costs.
The price of aluminum on the London Metal Exchange (LME) in the second to fourth quarters will be $3.3–3.7 thousand per ton, depending on the development of the situation in the Middle East, Kept analysts predict. Thus, relative to the first quarter, quotes may increase by 3–15%. As of June 12, the three-month aluminum contract on the LME is trading at $3.5 thousand per ton.
As stated in the Kept review, the price of aluminum moved into active growth with periods of short correction in the middle of the first quarter due to the closure of the Strait of Hormuz and damage to the capacity of key metal suppliers in the Middle East.
This led to their partial stop or reduction in production volumes. The region accounts for 8–9% of global primary aluminum production. It is not possible to fill the resulting deficit at the expense of China, the largest producer, since the country has a state limit on aluminum production of 45 million tons per year, Kept explains.
According to preliminary data from the International Aluminum Institute (IAI), in April, aluminum production in the Gulf countries decreased by 26.7% compared to March, to 10.9 thousand tons per day. Relative to the baseline level before the conflict, output fell by 38%. Global aluminum production, according to IAI, in April decreased by 2.13%, to 5.92 million tons. China accounted for 3.67 million tons, Europe, including Russia, 604 thousand tons.
Natalya Velichko, head of Kept’s metallurgical and mining practice, says that supply growth is also constrained by the high energy intensity of aluminum production. In addition, she said, the market is beginning to analyze the potential consequences of the intentions of Guinea, the world’s largest bauxite producer, to introduce export controls on the ore. “Most likely, such a move will lead to higher prices for raw materials and will put even greater pressure on the cost of aluminum,” says the analyst. At the same time, she continues, demand from the renewable energy, electric transport and artificial intelligence infrastructure sectors is expected to increase.
According to Kept’s forecast, in 2027–2030, aluminum prices may drop to $2.8–3 thousand per ton due to the restoration of capacity, recycling and the possible launch of new production. But, according to the forecast, quotes will remain above the levels of 2021–2025.
Boris Krasnozhenov, head of the analytics department at Alfa Bank, expects that in the medium term aluminum will be traded at $3-3.2 thousand per ton. According to him, China remains a net exporter of the metal and is capable of building a modern plant with a capacity of 1 million tons of primary aluminum per year in 12-18 months, so a shortage on the world market is unlikely in the foreseeable future. In addition, the analyst adds, Chinese aluminum producers consume 20-30% less electricity per ton of aluminum compared to their main competitors.
For Rusal, Mr. Krasnozhenov believes, an increase in prices to $3 thousand per ton on average for this year allows for more than doubling the level of EBITDA profitability. If the price of aluminum reaches an average level of $3.5 thousand per ton, then even at an exchange rate of 80–82 rubles/$, the company’s EBITDA can grow almost four times compared to the level of 2025, the analyst calculated. In 2025, Rusal’s revenue increased by 22.6%, to $14.81 billion, but EBITDA fell by 29.5%, to $1.05 billion. The company’s share, according to its own data, accounted for about 5.3% of global metal production.
Rusal notes that high quotes are offset by the strengthening of the ruble and an almost synchronous increase in costs. As the company clarifies, the most sensitive factor remains the raw material base. “Against the backdrop of high oil prices, materials for the production of anodes, primarily petroleum coke and pitch, are becoming more expensive. The increase in energy costs has already become one of the factors reducing the company’s financial results, and the dynamics in this context remain not in favor of the industry,” they say at Rusal. They added that after changing export routes, they are forced to transport raw materials and finished products over significantly longer distances, which is why transportation costs have increased.
