Aluminum stockpiles on the London Metal Exchange have declined to their lowest level in more than three decades, according to reports, as production challenges at key facilities continue to tighten global supplies. The decline reflects broader constraints in the aluminum supply chain, with prices on the LME rising sharply in response to the inventory squeeze.
The production disruptions stem from natural gas supply interruptions at major refining operations. Norwegian producer Norsk Hydro's Alunorte facility in Brazil, one of the world's largest alumina refineries, was forced to reduce output by 50% due to gas availability issues. The production cuts drove London aluminum prices to their highest levels in seven weeks, with the metal trading near $3,373 per metric ton and gaining nearly 2%. Alumina futures in Shanghai climbed 1% amid the global supply tightening.
Hydro indicated that aluminum production at the facility would return to full capacity once natural gas supplies stabilize. The supply constraints underscore the critical role that energy availability plays in maintaining aluminum production and meeting global demand for the lightweight metal widely used across automotive, aerospace, and construction industries.
