Morning Bites

🏭Global primary aluminium output declined 1.7% YoY in May, after the 1.8% YoY fall in April, per IAI data. Chinese supply (62% of global Al output) grew 2.0% YoY last month. Although local Al output — 44.8mnt annualised in 5mo26 — might technically exceed the cap of 45.0mnt/year (amid utilisation of previously unused quotas, etc), we do not expect the additional volumes to surpass 1.0mnt

Meanwhile, the output of Gulf nations (9% of global Al supply in 2025) shrank 35.2% YoY in May, amid the US-Iran conflict. Specifically, ~60% of the region's Al operations were affected to various extents since late-February (e.g., UAE’s EMAL, Bahrain’s Alba, and Qatar’s Qatalum). Given the nature of the damage, we anticipate sluggish production dynamics in the region until the year’s end

We maintain our view that strong consumption dynamics in Asia (including grid), combined with concerns over global supply, should provide support to Al price, which we forecast to average USD ~3,500/t in 2026F

#aluminium