The combined hit to Western aluminum production has been staggering. The International Aluminium Institute reports a 2.4 million tonne drop in Western output over the past two months. The closure of the Mozal smelter in Mozambique due to high energy prices compounds the Gulf crisis, removing 560,000 tonnes of annual capacity from the global supply chain.
China's giant aluminum production base has stepped up output but is now running close to the government's 45 million tonne capacity cap, leaving little room for further significant upside. Guinea has announced controls on bauxite exports starting in June, which will impact the raw material supply chain for Chinese smelters.
Wood Mackenzie projects a global supply deficit of up to 4 million tonnes this year. Western buyers will bear the brunt of that massive supply hit. Canadian aluminum imports into the US have fallen from 200,000 tonnes per month to roughly 50,000 tonnes since tariffs were imposed, while alternatives from China and Russia remain constrained by policy and banking risk.