Monthly Roundup: A market on edge

• What happened? Trump’s dropping a 25% tariff on aluminum from Canada and Mexico starting February 1, 2025, and talking about a 10% tariff on China’s aluminum too
• Why? He wants to push more U.S. aluminum production.
• Problem? The U.S. doesn’t produce enough aluminum to cover demand. Even if smelters fired back up tomorrow, they’d be years behind and would need a ton of investment. So, in the short term, American manufacturers and buyers are going to be paying a whole lot more for aluminum.
• Market reaction? Prices are already climbing because people see what’s coming. Everything from cars to beer cans are going to get more expensive.
• Industry take? “We don’t have the capacity to meet demand right now. The cost of production isn’t competitive without imports, and tariffs just push prices up,” an analyst told Reuters.

Canada: Trudeau isn’t having it

• What happened? Canada is frustrated about the U.S. tariffs and ready to hit back if they go into effect.
• What could they do? Trudeau says if the U.S. slaps tariffs on aluminum, Canada will return fire, likely hitting U.S. exports like cars, lumber, and oil with their own tariffs.
• Why does it matter? Canada is the biggest aluminum supplier to the U.S. If they fight back, prices go up even more and companies that rely on North American supply chains are in for a headache.
• Where it stands? Nothing’s set yet, but this could spiral into a trade war real fast if both sides dig in.

Europe: Russia’s getting locked out

• What happened? The EU is talking about a ban on Russian aluminum imports as part of their ongoing sanctions against Russia.
• What’s the plan? They might start with a quota system for a year, letting in only a small amount of Russian metal before fully cutting it off.
• What does it mean? If the EU bans Russian aluminum, prices in Europe are gonna skyrocket and Russia will start dumping their metal into Asia, mainly China.
• Market impact? Expect more price swings globally, and China could get cheaper aluminum while Europe pays more.

China: Scrap game just got cheaper

• What happened? China cut import tariffs on certain recycled aluminum and copper materials starting January 1.
• Why? They want to help their manufacturers get cheaper raw materials to stay competitive.
• Why does it matter?
  • Scrap aluminum just got more valuable because China is going to be buying more of it.
  • Primary aluminum producers might take a hit because if China can make more aluminum from scrap, they won’t need to buy as much newly mined aluminum from other countries.
  • Recycling markets worldwide are going to see shifts, expect to see higher scrap demand and price increases in regions that ship to China.

What’s expired and what’s still on the table?

Still active:

• Trump’s 25% tariff on Canadian/Mexican aluminum (set for Feb. 1)
• 10% tariff on Chinese aluminum (not confirmed yet, but in the discussion)
• Canada’s retaliatory tariff threats (waiting on U.S. decision)
• EU’s Russian aluminum ban (still being discussed, not finalized)
• China’s scrap tariff cuts (already in place)

Nothing has expired or been dropped yet—all these issues are still in play, and the next month or two will determine what actually goes into effect and what fizzles out.

Final take: Buckle up, aluminum’s in for a ride

This isn’t just about metal, it’s about trade wars, inflation, and global politics. If these tariffs and bans roll out as planned, expect higher aluminum prices in the U.S. and Europe, cheaper scrap aluminum in China, and a reshuffling of global supply chains.
If you’re in the aluminum industry, keep your head on a swivel—2025 is already throwing punches, and we’re only one month in.