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Informist, Wednesday, Nov. 19, 2025

MUMBAI – Fitch Solutions company BMI has raised its annual average aluminium price forecast for 2025 to $2,600 per tonne from its previous estimate of $2,580 per tonne. Although persistent geopolitical risks, soft global demand prospects and tariff headwinds linger as downside risks, some of these pressures have recently eased because of new trade deals and reduced US-China trade tensions. The end of the US government shutdown on Nov. 12 has renewed market optimism and contributed to a weaker dollar, adding a tailwind. "For the remainder of the year, we see risks to our forecast as broadly balanced but modestly skewed to the upside," it said in the report. 

Mounting expectations of a further US dollar weakness and a more favourable demand-supply outlook will further support prices. "We now expect the global aluminium market to move from an estimated 374kt (374,000 tonnes) deficit in 2024 to a more modest 79kt (79,000 tonnes) deficit in 2025, a shift from our prior forecast of an 18kt (18,000 tonnes) surplus, helping to anchor prices into year-end," it said.  

Aluminium prices have risen so far in 2025 by 13% on year to $2,859 per tonne as of Nov. 14, supported by macroeconomic tailwinds and a firmer-than-expected demand-supply outlook. This is despite the rollout of newly imposed US aluminium tariffs and ongoing geopolitical uncertainty.     

In 2026, prices of aluminium are expected to average $2,600 per tonne, above the 2025 average as demand picks up globally. "Beyond that, we expect aluminium prices to peak at USD2,900/tonne ($2,900 per tonne) in the second half of the decade as aluminium demand is supported by the acceleration of the green energy transition," it said.  

Aluminium prices are expected to rise in the long term, mainly because demand will stay strong in the construction, autos and renewables sectors. Carmakers will keep using more aluminium to make vehicles, especially electric vehicles, in order to extend vehicle range. Renewable energy technologies such as wind and solar also use much more aluminium than conventional energy sources. Demand will also grow from the packaging industry, as companies shift toward aluminium to improve sustainability.

In the long term, tight global market conditions are expected due to limits on how much China can increase aluminium production. "China is positioned to reach its peak smelting capacity of 45mnt (million tonnes) in the coming years, with installed capacity reaching 44.4mnt at the end of 2023. At present, new aluminium smelting capacity is only permitted to offset decommissioned capacity, and we expect the government will not extend the 45mnt cap due to its recent commitment to net zero emissions by 2060," it said.  End

US$1 = INR 88.50

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Reported by Reshma Ravi

Edited by Deepshikha Bhardwaj

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