The aluminum market is structurally undersupplied but in a compressed consolidation — four-year price highs, the steepest backwardation since 2007, and a 1.9Mt deficit projection are offsetting a 7.7% single-day price correction on June 4. The Gulf smelter shutdowns and Mozal closure have permanently removed 2.4Mt of Western capacity. Three catalysts will determine whether the market breaks to $4,200+ or corrects to $3,400: Strait of Hormuz shipping status, Chinese semis export trajectory (+15.4% YoY in April), and the pace of LME inventory drawdown into Q3. This report covers price structure, supply-demand balance, inventory positioning, trade policy, and forward contracting strategy.
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