The aluminium price premium is experiencing a historic price surge. The physical market premium in the United States has skyrocketed beyond $990 per metric ton. This sharp increase follows the U.S. government’s decision to double tariffs on Canadian aluminium imports to 50%.
The primary reason behind this surge is the newly imposed tariffs. On Tuesday, President Donald Trump announced that the planned tariff rate on Canadian aluminium would increase from 25% to 50%. This policy shift has significantly impacted the aluminium supply chain.
Canada remains the largest supplier of aluminium to the U.S., contributing nearly 70% of the total 3.92 million tons imported last year. This data, sourced from Trade Data Monitor, highlights the importance of Canadian smelters in the American aluminium market.
With the tariff increase taking effect on Wednesday, aluminium buyers in the U.S. must now pay higher premiums. Typically, aluminium price premium include the benchmark rate set by the London Metal Exchange (LME) plus a premium that covers taxes, transportation, and handling costs.
On Tuesday, the U.S. Midwest duty-paid aluminium premium spiked to 45 cents per pound. This translates to over $990 per metric ton, marking a 70% rise since the start of 2025. This drastic increase could impact manufacturers relying on aluminium, leading to potential cost hikes in industries such as automotive, construction, and packaging.
The U.S. decision to raise tariffs is a response to a policy change by Ontario, Canada. The province recently imposed a 25% tariff on electricity entering the U.S. This move prompted the U.S. administration to retaliate by increasing duties on Canadian aluminium imports.
Industry analysts predict continued volatility in aluminium price premium. If the trade tensions between the U.S. and Canada persist, further price increases could occur. Businesses that rely on aluminium may seek alternative sources or adjust pricing strategies to mitigate costs.
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Aluminium price premium hits a record high after the U.S. doubles tariffs on Canadian metal. Learn how this impacts the market.
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