The Aluminum Shock Hitting the Global Economy

追加: 2026-06-01

[00:00:00]Westin: This is a story about trying to have it both ways.

[00:00:02]Since he first became president, Donald Trump has sought to protect the U.S. aluminum industry through tariffs.

[00:00:08]But the war in Iran may be taking us in a very different direction.

[00:00:12]Our colleague Chrystia Freeland tells us a story of a key metal that is caught in the middle.

[00:00:20]-Aluminum foil keeps foods from drying out while sealing in all their natural flavor.

[00:00:28]-When you think about aluminum, the first thing that comes to mind might be tinfoil or soda cans, but it's also an essential component of cars, planes, and machinery.

[00:00:38]It's the world's most abundant metal.

[00:00:39]But even that hasn't kept aluminum safe from the fallout of war.

[00:00:44]-The supply is now depleted by about half of the metal that used to be shipped from the Middle East because there's been some damage and there's been some curtailments to avoid further damage.

[00:00:57]-Jean Simard is the president and CEO of the Aluminium Association of Canada.

[00:01:03]-It's a very significant situation for the aluminum sector worldwide because the Middle East produces 20 percent of all the aluminum outside China and it ships to Asia but mostly to the U.S.

[00:01:17]and to Europe.

[00:01:19]-Of the top aluminum producing countries in the world two are in the Middle East.

[00:01:24]And Simard says the impact of the war in Iran could be long lasting.

[00:01:29]-Starting at the beginning of the crisis, the first curtailment happened in Qatar because of an energy supply situation and then damage was done in Bahrain and then to the Al Taweelah smelters in the Emirates.

[00:01:45]This is very significant because it will take a long time to bring it back.

[00:01:52]Smelters are very highly impacted by energy.

[00:01:59]And to restart a smelter, you have to do, like if there is a supply problem with electricity for your house, you have to unplug everything and then replug one at a time.

[00:02:11]So they can only start back two cells a day out of hundreds and hundreds of cells.

[00:02:16]-Production is just one part of the aluminum supply chain facing disruption.

[00:02:21]Distribution is another.

[00:02:22]Like so many of the world's exports, aluminum needs to be shipped often a long way and shipments are snarled by the blockade of the Strait of Hormuz.

[00:02:32]-The problem is what's in front of us.

[00:02:35]The last ship to leave the Middle East just before the beginning of the crisis has made it to the U.S.

[00:02:42]There's no other ship on its way.

[00:02:44]It took 60 days to get there.

[00:02:46]So the full shock is ahead of us.

[00:02:49]I'm not too sure that all downstream transformers processors, mom and pop shops that use aluminum are fully aware of what's ahead of them.

[00:02:59]-In the first two weeks of the war, the price of aluminum on the London Metal Exchange saw double digit gains shooting to record highs.

[00:03:07]But while the war added to rising prices around the world, some of the fallout in the U.S.

[00:03:12]is self-inflicted.

[00:03:13]Last year President Trump hiked tariffs on imports of aluminum to 50 percent with the intention of stimulating domestic production.

[00:03:21]As of 2025, the U.S. was dependent on imports to meet some 60 percent of internal aluminum consumption.

[00:03:29]And that was something that the Trump administration didn't like.

[00:03:33]-The U.S. is a short market on primary aluminum.

[00:03:35]So the U.S. need to import a lot of primary aluminum to fill demand.

[00:03:40]So to attract that metal that U.S. consumers or manufacturing using aluminum in effect how to pay the duty on aluminum into the U.S. market.

[00:03:54]-Trond Olaf Christophersen is the CFO of Norsk Hydro, a publicly traded aluminum producer based in Norway.

[00:04:00]The company is also in the unique position of having a production facility in Qatar.

[00:04:05]-Our joint venture in Qatar, Qatalum, has been impacted by the war and is currently operating around 60 percent production capacity because of the situation.

[00:04:18]And we continue to operate around that level.

[00:04:21]It is a challenging situation with the raw material access and also to get metal out from the region.

[00:04:28]But we are continuing to operate at that production level.

[00:04:32]-And so is the U.S. now facing more of an aluminum crisis than other parts of the world?

[00:04:38]-Well, the supply situation, I think, is... or the situation may impact the supply situation in all markets.

[00:04:48]Physically, when it comes to supply, I think the Asian markets is worse impacted because quite a lot of the metal from the Middle East is normally sold in Asia around two and a half million tons.

[00:05:00]But the price impact is global.

[00:05:03]-This isn't the first time the United States has imposed tariffs on Canadian aluminum.

[00:05:07]In 2018, when I was foreign minister, the trade spat between our two countries ended with the U.S. backing down.

[00:05:15]And although the U.S. is facing higher aluminum prices today, Simard says that's not a direct effect of the war in Iran.

[00:05:23]That's because the vast majority of aluminum the United States imports comes from Canada.

[00:05:28]-When the tariffs, the 50-percent tariff were implemented, it created a price shock in the market for exporters into the U.S.

[00:05:39]as Canada is one of them.

[00:05:41]And, basically, the reaction was to divert shipments to another market which covered the full logistical costs and the whole net back that would differentiate this destination from the U.S.

[00:05:55]One thing you're sure, if you want to get all the available supply from Canada, you have as a policymaker in the U.S.

[00:06:04]to do a carve out for Canada within the global tariff situation right now.

[00:06:10]If that doesn't happen, Canada will go where the market is.

[00:06:16]-Among the industries that are most affected by higher aluminum prices are packaging and transportation from trains and trucks to mopeds and bikes.

[00:06:26]And that's where Brendan Moore comes in.

[00:06:28]-Fundamentally, aluminum is one of the primary materials used on a bicycle.

[00:06:31]The reason is it's very light, very strong, reasonably priced.

[00:06:37]You know, it's not a super exotic metal.

[00:06:40]-Moore's company, Wolf Tooth Components, makes premium bike parts that are shipped all over the world.

[00:06:46]His manufacturing plant in the suburbs of Minneapolis is about 7000 miles from the Strait of Hormuz.

[00:06:51]But he's still feeling the consequences of the war in Iran.

[00:06:55]-We're a small company like us.

[00:06:56]We're not Boeing, so we don't get to say Kaiser send us 10 truckloads of aluminum.

[00:07:01]We buy our aluminum through suppliers locally and those suppliers will source that from various suppliers around the world.

[00:07:09]We don't get a lot of choice in where our aluminum comes from, but I can tell you that it's shifted and we do have a preference for U.S. aluminum.

[00:07:17]-Eventually, the only solution for a manufacturer like Moore might be to raise prices.

[00:07:22]But he says it's not so simple.

[00:07:24]-In consumer goods.

[00:07:26]I would say it's not like when you go to the restaurant and there's like lobster pricing and it's like market rate.

[00:07:31]That's not how consumer goods work.

[00:07:34]And when prices of aluminum or raw material go in, we can't necessarily just like raise our prices right away.

[00:07:41]Raising prices, remember, does three really bad things.

[00:07:44]One, it upsets your customers.

[00:07:47]Two, it puts you at a disadvantage to your competition.

[00:07:52]And three, it's actually a lot of work.

[00:07:54]And so when aluminum goes up effectively, initially, we just eat it, just comes right out of our bottom line.

[00:08:01]-Moore has seen peaks and valleys in the price of aluminum before.

[00:08:05]But he says this time is different.

[00:08:08]-If you look there was COVID, which aluminum prices started going up.

[00:08:12]But then, actually, the biggest peak was right when the Russian war started, just went crazy high.

[00:08:18]And then tariffs came in and then the Strait of Hormuz was closed.

[00:08:24]But the biggest thing people are talking about and you're seeing this broadly across commodities is the AI build out is actually one of the big impacts for aluminum prices going up right now.

[00:08:33]Those data centers that we all hear so much about they use a ton of raw material and a lot of it is aluminum.

[00:08:38]And so kind of we're seeing like a triple whammy now if you will.

[00:08:43]-Smaller manufacturers like Wolf Tooth Components not only have to contend with higher prices for the metal they need, but also have to compete against bigger more powerful players that also use aluminum.

[00:08:55]The squeeze could eventually raise prices across the board for consumers triggering another bout of inflation.

[00:09:01]-There's really no viable alternative to aluminum in our case.

[00:09:07]And you'd hear the same thing if you ask Boeing, like, they're still going to use tons of aluminum in the airplanes no matter what the prices and the price of those airplanes will just go up.

[00:09:15]Same with our bicycle parts.

[00:09:17]-As the war drags on, so does the timeline for prices to stabilize.

[00:09:21]Back in Norway.

[00:09:22]Christophersen says the outlook is far from certain.

[00:09:26]-So in the aluminum market, I think we see a bit the same situation as you see in the energy markets where you have quite high prices in the front then meaning metals to be delivered in the coming month.

[00:09:38]But then you have a declining price, a backwardation situation in the markets with lower prices falling down to 3,000 dollars per ton a couple of years out in time.

[00:09:49]-So it will take anywhere between 12 to 18 months for the Middle East supply that's been affected to come back into the market.

[00:09:59]And then you need 60 days to ship to North America that you add to this.

[00:10:05]So we're heading for a supply shock as we move through the summer period.

[00:10:12]And this will last, most likely, for about a year, a year and a half, until this supply starts to make its way back into the market.

[00:10:21]-For business owners like Brendan Moore the effects of domestic and foreign policy have become an unavoidable hazard of the job.

[00:10:29]-We control the processing.

[00:10:30]We control our efficiency.

[00:10:32]We control our yields.

[00:10:33]So we have to just focus on those.

[00:10:34]I think near term we're going to be able to mitigate most of the aluminum prices, longer term if it stays this high, there has to be some sort of increase.

[00:10:44]But a consumer, if aluminum goes up 20 percent again this year, our prices of our products aren't going to go 20 percent.

[00:10:50]They're going to go up, like, 3 or 5 percent.

[00:10:53]And I like Boeing.

[00:10:54]I mean, I'm trying to poopoo them at all, but like we don't have the negotiating power that, say, they have or an automaker has.

[00:11:00]And when these prices change or tariffs change, I see that almost the same day.

[00:11:06]I mean, not joking sometimes.

[00:11:08]Well, I didn't start this small business because I wanted to learn about tariffs or deal with massive supply chain issues or deal with geopolitics.

[00:11:19]Those are in fact some of my least favorite things.

[00:11:21]Bicycles are way more fun than that stuff.

[00:11:24]-With all the back and forth of tariffs and wars, it's hard to see how U.S. policy at the moment is helping American manufacturers or American consumers.

[00:11:34]And this is one problem that the marketplace can't fix on its own.