Key Moments
- Global primary aluminum production rose 3.5% month-on-month to 6.2mt in May, according to International Aluminium Institute data.
- ING estimates around 3mt of capacity has been removed from the market due to Middle East disruptions and is unlikely to return quickly.
- ING strategists continue to project a global aluminum deficit of around 1.8mt this year despite higher output in China, Europe and Asia ex-China.
Ongoing Supply Disruptions Sustain Deficit
ING strategists Warren Patterson and Ewa Manthey report that global aluminum production has been increasing, with gains seen in China, Europe and Asia ex-China. However, they note that the market remains in a deficit position.
The strategists estimate that approximately 3mt of capacity has been lost as a result of disruptions in the Middle East and state that this volume is unlikely to be restored quickly. They maintain their outlook for a sizeable global aluminum deficit this year.
Latest Production Data from the IAI
“In other metals, data from the International Aluminium Institute (IAI) showed that global primary aluminium output rose 3.5% month-on-month to 6.2mt in May. This reflects higher production across most major regions.”
Despite this increase, ING’s team reiterates that the supply side remains constrained by geopolitical and operational factors.
Forecasts for the Global Balance
“However, the aluminium market is still expected to remain in deficit this year. Supply disruptions linked to the Middle East conflict have removed an estimated 3mt of production from the market.”
“Lost capacity is unlikely to return quickly given the lengthy restart process for smelters. We continue to forecast a global aluminium deficit of around 1.8mt this year.”
Regional Production Trends
China continues to be a key driver of global supply. ING notes that:
“China’s aluminium production rose 2% year-on-year to 3.8mt in May as stronger margins supported smelter utilisation rates. Aluminium exports continued to increase, rising 16% year-on-year in May, supported by stronger international prices. However, further production growth remains constrained by government capacity caps.”
Outside China, output trends are mixed across regions.
Europe, Asia ex-China, and Gulf Developments
“Aluminium production increased across Europe and Asia ex-China in May, while Gulf output remained more than 35% below year-ago levels due to ongoing supply disruptions linked to the Iran conflict.”
These regional divergences underpin ING’s view that, despite rising production in several key markets, the global aluminum market will remain undersupplied this year.
Selected Aluminum Market Metrics
| Metric | Value | Period / Comparison |
|---|---|---|
| Global primary aluminum output | 6.2mt | May, 3.5% month-on-month increase |
| Estimated capacity removed due to Middle East disruptions | 3mt | Current estimate |
| Forecast global aluminum deficit | 1.8mt | This year |
| China aluminum production | 3.8mt | May, 2% year-on-year increase |
| China aluminum exports | 16% year-on-year increase | May |
| Gulf aluminum output | More than 35% below year-ago levels | Current level |
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