Global aluminium market seen closer to balance in 2025, Rusal says
- Global end-use demand seen rising by 3.5% y/y in 2025 - Rusal
- Global aluminium surplus seen at 200,000-300,000 T in 2025
The global aluminium market surplus should narrow - moving closer to balance in 2025 - as lower borrowing costs and Chinese stimulus should boost demand, said Rusal RUAL, the world's largest aluminium producer outside China.
Russia's Rusal, responsible for 5.5% of global aluminium supply, has been increasing deliveries to China - to compensate for lower sales in Western markets, where demand has taken a hit from sanctions imposed on Moscow over war in Ukraine.
Chinese aluminium demand growth may slow in 2025, but its primary market remains in structural deficit, while the market outside China is oversupplied, Rusal said in written responses to Reuters' questions ahead of LME Week, a global industry gathering in London, which started on Monday.
Rusal expects a global aluminium surplus of around 500,000 metric tons in 2024 and between 200,000-300,000 tons in 2025.
Global primary aluminium production stood at 48.2 million tons in January-August 2024, up 3.2% year on year, International Aluminium Institute data shows.
China is now Rusal's largest export market.
The LME banned deliveries of newly-made Russian aluminium, copper and nickel to the LME-registered warehouses from April to comply with U.S. and British sanctions.
Signalling toughening conditions, Rusal's first-half revenue fell 4% to $5.7 billion as sales slid 3% to 1.9 million metric tons while the premium it charges over the LME price eased.
Rusal said however, it "continues to witness a broad acceptance of its low carbon aluminium from a variety of end users and across its global customer base."
Talks about 2025 sales - which coincide with LME Week - "are ongoing and consistent with typical negotiations cycle," Rusal said. It did not provide further details.
As the majority of global producers are profitable at current prices for the metal, used in the construction, transportation and packaging sectors, production is rising with new capacity ramp-ups in Indonesia and Russia along with resumed capacity in Latin America, Rusal said.
Higher output is largely offset by higher end-use demand, which Rusal expects to rise by 2.5–2.7% in 2024 and by 3.5% in 2025.
Three-month LME aluminium ALI1! touched $2,659, the highest since June 6, last week. The metal is up 10% so far this year.