Matalco output rebounds from post-closure low

Meanwhile, Rio Tinto reported a higher tariff burden on aluminum shipped to the US. The change occurred even as its US shipment volume declined.

Matalco production rebounds from Q1

Matalco produced 139,600 metric tons of recycled aluminum during the second quarter on a 100% ownership basis, an increase of about 15% from 121,1000 metric tons in the first quarter.

Rio Tinto attributed the sequential increase to higher productivity across the recycled aluminum business.

On a year-over-year basis, production totals were roughly 5% below the 147,100 metric tons reported in the second quarter of 2025.

Half-year output decreased to 260,800 metric tons from 279,200 metric tons year over year.

Matalco operates remelt facilities that primarily serve the North American market producing billets and slab as well as tolling services for scrap processing.

Most of its plants are in the US, while one is in Canada. Rio Tinto owns half of the joint venture, placing its attributable production at about 69,800 metric tons for the quarter and 130,400 metric tons for the first half.

The increased output followed several consecutive quarterly decreases. Matalco’s 100% production fell from 147,100 metric tons in the second quarter to 135,300 metric tons in the third quarter, the first full reporting period after the Ohio facility began closing operations in early June 2025. Production then declined to 123,600 metric tons in the fourth quarter of 2025.

This marked Matalco’s highest quarterly production since the Canton facility began closing in June 2025. At 139,600 metric tons, output recovered about 71% of the gap between the post-closure low of 121,000 metric tons in the first quarter of 2026 and the 147,100 metric tons produced in the second quarter of 2025, when Canton remained open but had begun winding down.

Primary aluminum production steady

Companywide, Rio Tinto produced 840,7000 metric tons of primary aluminum during the quarter, down 0.2% from 842,300 metric tons in the prior year period. Production increased 0.7% from 834,900 metric tons in the first quarter.

First-half output totaled 1.676 million metric tons, an increase of 0.2% from the first six months of 2025.

Rio Tinto said higher production at Kitimat in Canada, Tiwai Point in New Zealand (New Zealand Aluminium Smelter), and the AP60 Arvida smelter in Canada supported the sequential increase. The planned closure of the remaining older Arvida potlines limited the companywide gain.

Wholly owned smelters

Among Rio Tinto’s wholly owned Canadian primary aluminum smelters, Kitimat produced 108,000 metric tons during the quarter, an increased of nearly 6% from the prior year period.

Grande-Baie production increased to 57,000 metric tons from 56,000 metric tons, while Alma output rose to 122,000 metric tons from 120,000 metric tons. Production at Laterrière remained unchanged at 62,000 metric tons.

Including the Arvida operation in transition, Rio Tinto’s wholly owned Canadian smelters produced 379,000 metric tons during the quarter, a decrease of slightly more than 3% year over year. Output was nearly unchanged from the first quarter.

Joint venture smelters

Among Rio Tinto’s joint venture smelters, Bécancour produced 117,000 metric tons on a 100% ownership basis, down from 120,000 metric tons a year earlier. Rio Tinto holds a 25% interest in the operation.

Conversely, production at Alouette in Sept-Îles increased to 159,000 metric tons from 154,000 metric tons on a 100% ownership basis. Rio Tinto holds a 40% interest in that smelter.

Arvida transition

Rio Tinto closed the final two potlines at its older Arvida smelter in June as planned.

The company announced in 2025 that it would complete the transition to the adjoining AP60 operation.

The transition from Arvida’s older potlines to the AP60 operation continued to reduce production at the site. The remaining older potlines produced 13,000 metric tons during the quarter, down from 36,000 metric tons a year earlier. AP60 production increased to 17,000 metric tons from 15,000 metric tons in the second quarter of 2025.

Rio Tinto began commissioning work for the AP60 expansion in May. The company said it continued staged testing and system handovers during the quarter. Construction work remained concentrated in brownfield and replacement areas.

The company noted construction was nearing completion and maintained its plan to fully ramp up the expanded smelter by the end of 2026. The transition will continue to limit Canadian production until the additional AP60 capacity reaches its planned operation rate.

US tariff costs increase, shipments decline

Rio Tinto shipped 585,000 metric tons of aluminum to the US during the first half of 2026, down a little more than 19% from 723,000 metric tons in the first half of 2025.

Nevertheless, the company’s reported aluminum tariff costs increased to $733 million in the first six months of 2026 from $321 million a year earlier. Average realized tariff costs on shipments to US destinations increased to $1,322 per metric ton from $444 per metric ton.

However, the comparison spans sharply different tariff periods.

The aluminum tariff increased to 25% from 10% toward the end of the first quarter of 2025, before rising to 50% months later. Rio Tinto did not disclose tariff costs separately for the first and second quarters.

The company also reported an average duty-paid Midwest premium of $2,406 per metric ton for the first half, compared with $855 per metric ton during the previous year period. The company said the premium applied to approximately 40% of its total aluminum volumes.

Smelting cost mix also shifted during January through June from the year earlier. Alumina accounted for 38% of production cash costs, down from 52% the previous year. Power cash costs rose to 23% from 17%, as did carbon costs to 16% from 12%.