Building & Construction
24 March 2025
Week in Review: Reflect and regroup
Written by Gabriella Vagnini
This week, the aluminum market faced continued supply pressures and fluctuating demand. But with that said, it seemed like a week that everyone returned to the think tank. Absorbing the new tariffs and the possible tariffs to come and exploring their options without making any subtle moves.
Primary market stuck in neutral
- LME aluminum prices saw a widening in the cash to 3-month backwardation due to the tariff but quickly corrected itself by the end of the week.
- The Midwest Premium started trending down as companies would look to be cashing in their longs. As the market was thinking it would push towards $0.50/lb, it is now below $0.40/lb. It hasn’t been below $0.40/lb since February 20.
- Smelters are still feeling the pinch from weak demand. Companies debating if they should hold off, hoping for another swift move downward Trump.
- No real momentum from industrial buyers, keeping the market a bit sluggish.
Secondary aluminum holding its own
- Scrap flows stayed steady, and automotive + packaging demand kept things moving.
- Secondary aluminum remains the more cost-effective choice for a lot of buys.
Downstream markets mixed
- Construction markets are still sluggish, which could pressure margins on extrusions and castings.
- Aerospace and defense demand stayed stable, no real changes there.
Tariffs & Trade Policy Updates
- The market is watching the upcoming March 12 tariff deadlines, with potential implications for North American imports, trade flows, and pricing strategies. Adding on to the already implemented 25% tariffs on aluminum imports.
What it means moving forward
- Aluminum is still in a holding pattern, no major catalysts…yet.
- Tariff talk and trade policy decisions could shake things up soon.
- Downstream players need to stay flexible, if primary prices don’t move, margins could get squeezed.
