Global aluminium markets remain in deficit despite rising production across major manufacturing regions, according to ING strategists Warren Patterson and Ewa Manthey. Output is climbing in China, Europe and other Asian markets, but supply disruptions continue to constrain availability. The strategists estimate approximately three million tonnes of aluminium production capacity has been knocked offline due to Middle East disruptions, and this lost capacity is not expected to return to markets in the near term.
The persistent deficit suggests upward pressure on aluminium prices will continue even as producers ramp up operations in other regions. The supply gap comes at a time when global demand for the lightweight metal remains robust, particularly from electric vehicle manufacturers and renewable energy sectors requiring significant aluminium inputs for batteries and infrastructure.
FXnCO Insight
Traders should position for continued aluminium price strength as the three million tonne Middle East supply gap cannot be quickly replaced by production increases elsewhere, creating a sustained bullish setup for aluminium futures and related commodity plays.
Source: FXStreet