Fluctuations in Aluminum Prices: Bernstein's Predictions

Bernstein has maintained its aluminum price forecast at $3,100 per ton for the second half of 2026. The ceasefire in the Strait of Hormuz and the rapid recovery of production in the Middle East have alleviated supply concerns. However, the firm has not changed its target.

Fluctuations in Aluminum Prices - Aluminum prices rose sharply from March to May. The crisis in the Strait of Hormuz threatened metal exports and raw material imports. With the ceasefire and the reopening of shipping routes, the risk premium has largely disappeared.

Market Conditions - Physical market conditions are tighter than before the crisis. Production in the Middle East has recovered faster than expected. EGA announced that its Al Taweelah facility, with an annual capacity of 1.6 million tons, has resumed operations ahead of schedule.

■China is adding 740,000 tons of new aluminum smelting capacity this year. Total production is expected to reach approximately 45.3 million tons.

Demand and Production - China's export-oriented sectors have remained resilient. However, domestic demand for construction and real estate continues to weaken. Manufacturing conditions in Europe, Japan, and the US have stabilized. Nevertheless, underlying demand remains weak.

■Bernstein notes that aluminum margins are above their long-term mid-cycle levels. The market is expected to continue to post a surplus in 2026, supporting prices above $3,000 this year. Afterwards, prices are expected to gradually normalize towards long-term mid-cycle levels.

Markets will remain sensitive to this situation. Fluctuations in aluminum prices are considered an important indicator for investors and producers closely monitoring global economic trends.