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| 2025 International Aluminium Conference |
Focus Keyphrase: 2025 International Aluminium Conference
The 2025 International Aluminium Conference will highlight crucial market dynamics, especially the impact of the European Carbon Border Adjustment Mechanism (CBAM). Market participants closely monitor CBAM's implementation, which begins its “definitive” phase on January 1, 2026. However, the EU’s delayed guidance on CBAM certificate pricing creates significant uncertainty in contract negotiations for 2026. Fastmarkets' carbon team has developed a CBAM cost calculator to help importers estimate costs amid this ambiguity.
EU Market Adjusts to CBAM and Premium Spread Developments
European aluminium premiums show signs of adjusting ahead of CBAM enforcement. The P1020A ingot premium in Rotterdam rose due to low inventory levels and reduced duty-free imports from Canada. Meanwhile, the differential between duty-paid (DP) and duty-unpaid (DUP) aluminium premiums is narrowing, reducing the incentive to pay the 3% duty on DUP imports. This dynamic, combined with tighter DUP supply following geopolitical tensions, affects trade flows and pricing strategies in the European market. Traders anticipate some clearing of DUP units before CBAM enforcement to avoid increased costs.
Rising Indonesian Output and US Tariff Uncertainty Shape Global Aluminium Landscape
Indonesia’s aluminium output is projected to surge, with production expected to reach 1.25–1.5 million tonnes by the end of 2026, supporting global supply expansion. Meanwhile, the US market faces ongoing tariff policy uncertainty following the imposition of Section 232 duties on aluminium imports. These tariffs have caused premium spikes and supply tightness, especially in billet markets. Scrap shortages compound this tightness as more primary scrap is diverted for remelting. Market participants await clarity ahead of 2026 contract negotiations to navigate these evolving trade and regulatory challenges.
ScrapInsight Commentary
CBAM implementation will reshape European aluminium trade costs and premiums, pressuring smelters and traders. Indonesia’s growing output could ease supply tightness, while US tariffs continue to distort the market and elevate scrap demand. Market participants must closely monitor regulatory developments for strategic planning.
