Aluminium prices have surged past $US3000 a ton, marking the first time in over three years that the metal has reached such heights. This surge is attributed to a tightening supply outlook coupled with long-term demand expectations. Aluminium is a lightweight, corrosion-resistant metal used extensively in construction, transportation, and packaging. The price increase mirrors similar gains in other base metals, which have also achieved recent milestones.
Several factors contribute to the constrained supply. A cap on Chinese smelting capacity and limitations on European production due to increased electricity costs have significantly reduced global inventories. Meanwhile, demand remains strong from the construction and renewable energy sectors, further supporting the price rally. Last year, aluminium futures experienced a 17 per cent increase, the most substantial since 2021.
Copper also saw gains, building on its best annual performance since 2009, driven by tight supply conditions. Nickel prices jumped after Vale Indonesia temporarily halted mining operations due to a delay in work plan approval from authorities. While the company anticipates prompt approval and minimal impact on overall sustainability, the news has heightened concerns about nickel supply, particularly given Indonesia’s stated intentions to reduce output this year.
