FX.co ★ Aluminum Rises Past $3,000

Aluminum futures in the United Kingdom have surpassed $3,000 for the first time since 2022, spurred by heightened concerns over supply shortages. China, the leading global producer of aluminum, has once again emphasized its commitment to preventing overcapacity in metal production to mitigate deflationary pressures on manufacturers. The nation is poised to exceed its 45 million ton production cap this year, compelling smelters to limit output growth by 2026. This scenario has led companies to divert their constrained supply to domestic markets instead of exporting, resulting in a 9.2% annual decline in exports as of November. Simultaneously, attempts by Chinese smelters to establish new operations in Indonesia are encountering obstacles, predominantly due to increased energy costs and regulatory challenges. In other regions, such as Iceland, Mozambique, and Australia, elevated energy expenses, equipment malfunctions, difficulties in obtaining bauxite, and geopolitical tensions have led to the suspension of significant smelting operations.