ISTANBUL

Aluminum climbed to its highest level since April 2022, reaching $3,225 per ton on the London Metal Exchange (LME), as base metals started the year strong amid expectations of US interest rate cuts, ongoing demand from China, and concerns over tariffs and supply.

Production disruptions and lower output targets pushed base metal prices higher, while production growth remained limited last year and is expected to stay subdued this year. Copper prices, in particular, supported gains across the broader base metals complex.

Aluminum stabilized at $3,186 per ton on the LME. The metal ended 2025 at $2,995.5, marking a 6.4% increase in the first 15 days of 2026.

Widely used in construction, automotive and packaging, aluminum has also become increasingly central to the green energy transition due to its role in solar panels, wind turbines, electric vehicles (EVs) and batteries. Expectations of a global economic recovery have further supported prices.

Rising investment in artificial intelligence (AI) and growing demand from data centers, energy grids and the electronics sector have also contributed to the increase in aluminum prices.

Beijing is expected to take steps to support the economy by curbing metals production capacity to ease deflationary pressures, a move that analysts say could further lift aluminum prices.

Zafer Ergezen, a futures and commodity markets analyst, told Anadolu that the new year began with rising expectations of interest rate cuts.

Ergezen said expectations increased after Jerome Powell is set to be replaced by a new Federal Reserve chair to be appointed by US President Donald Trump, while demand for commodities is also rising amid recovery expectations.

“Aluminum becomes one of the most sought-after commodities when growth and recovery in China are expected due to its widespread use in many areas, including the auto industry and home appliances — the demand is expected to rise on this side,” he said.

Ergezen added that China is expected to continue domestic incentives this year, supporting hopes of stronger internal demand.

“Global markets expect a recovery, especially in the second half of the year, which is expected to boost demand,” he said. “We see companies gradually bracing for this in advance with rising purchases and volumes in forward transactions, and we may see a rise in deliveries, too.”

He noted that China and Russia are among the world’s top aluminum producers, while tariff concerns and a weakening US dollar have added to price pressures.

“The US is the top aluminum consumer, followed by Japan, so we can say the expectation of a recovery is taking effect,” he said.

“Rate cuts, inflation concerns, recovery expectations, the impact of tariffs, a falling US Dollar Index, China’s incentives, sanctions on Russia, and supply concerns pushed up aluminum prices,” Ergezen added.