Aluminum futures in the UK rose to $3,890 per tonne in March, the highest in nearly four years, as a halt in supply from the Persian Gulf magnified an already tight backdrop. Iran struck targets in all GCC countries, driving major producers to stop aluminum refining activity and risking the suspension of operations in the region that produces 10% of global supply. Qatar halted its aluminum operation with Norsk Hydro in the country and Bahrain’s Alba declared force majeure and halted all deliveries for the time being. Higher output from top producer China is not expected to make up for the developments as its supply is capped by 45 million tons this year, in line with the government’s aim to limit overcapacity in key good producing sectors, while smelters struggle to build new plants in Indonesia amid higher energy costs and local regulations risks. The developments come as stocks at the LME and COMEX ae already near record lows.
