As the Middle East situation escalates and freight shipping risks in the Strait of Hormuz intensify, global aluminum supply is facing unprecedented pressure, which has a direct impact on industries related to aluminium profile, including the aluminium window and door industry. The continuous rise in aluminum prices in the global market not only reflects the market’s worries about tight global aluminum supply but also triggers chain reactions in global trade. As an aluminium window and door factory, we are deeply aware of how the current situation will shape the cost and availability of aluminium profile, making it critical to stay aligned with the shifts in global aluminum supply and global trade dynamics.
l Strait of Hormuz Crisis: A Major Threat to Global Aluminum Supply and Freight Shipping
The Strait of Hormuz, a key channel for global freight shipping, has become the core of the Middle East conflict’s impact on global aluminum supply. After Iran’s Islamic Revolutionary Guard announced the closure of the strait on March 2, freight shipping of aluminum-related raw materials and products has been severely hindered. The Gulf region accounts for about 9% of the world’s primary aluminum production capacity, and its aluminum exports and raw material imports are highly dependent on freight shipping through the Strait of Hormuz. Once freight shipping is blocked for a long time, it will not only affect the export of aluminum products but also lead to a shortage of alumina, a key raw material for aluminum smelters, directly disrupting the stability of global aluminum supply. As a key raw material for aluminium window and door production, the shortage of aluminium profile will also follow, affecting the normal operation of global trade in the aluminum processing industry.
l Smelter Shutdowns: Exacerbating the Tension of Global Aluminum Supply
The impact of the Middle East conflict on global aluminum supply has already appeared in actual supply disruptions. Major aluminum smelters in the Gulf region have successively suspended production or reduced output due to raw material shortages and energy supply interruptions, further exacerbating the tension of global aluminum supply. Norsk Hydro’s Qatalum smelter and Bahrain’s Alba smelter have issued force majeure notices, with a combined annual production capacity of more than 2.2 million tons. The long-term shutdown of these smelters will not only reduce global aluminum output but also affect the supply of aluminium profile, as aluminium profile is processed from primary aluminum. The disruption of global trade caused by the conflict has also made it more difficult for aluminum products and aluminium profile to be transported between regions, further worsening the imbalance between supply and demand in global aluminum supply.
l Price Surge and Market Outlook: Impacts on the Aluminium Profile Industry
Against the backdrop of tight global aluminum supply, aluminum prices have continued to soar, which has a profound impact on the aluminium profile industry and global trade. The LME 99.7% aluminum spot price hit a new high since 2022, and the U.S. Midwest aluminum premium also rose sharply. For aluminium window and door factories, the rising price of primary aluminum will directly increase the production cost of aluminium profile, putting pressure on enterprise operations. Citigroup’s research predicts that if the supply disruption intensifies, aluminum prices may rise further, which will continue to affect the stability of global aluminum supply and global trade. In this context, it is essential for aluminium window and door manufacturers to closely monitor changes in global aluminum supply and adjust their procurement and production strategies to respond effectively to the market fluctuations brought by the Middle East conflict.
