Home - News - The attacks by the United States and Israel on Iran may affect Japan's aluminum purchases, and the aluminum premium may reach a new ten-year high.
The attacks by the United States and Israel on Iran may affect Japan's aluminum purchases, and the aluminum premium may reach a new ten-year high.
March 5, 2026
The chaos caused by the attacks on Iran by the United States and Israel could not only affect crude oil and natural gas, but also the purchase prices of aluminum.
The premium that Japanese aluminum processors pay to major aluminum producers is expected to reach its highest level in nearly a decade. Aluminum has a wide range of applications, including beverage containers, automotive parts, and building materials such as window frames. If this situation persists, it could lead to an increase in the prices of final products.
The premium of aluminum price reflects the regional supply and demand relationship. When buying or selling aluminum ingots, it needs to be added to the price on the London Metal Exchange (LME). Affected by factors such as US tariffs, the aluminum price has been on an upward trend since last year, but the uncertainty of the situation in the Middle East has exacerbated this trend.
The large-scale resource producer Rio Tinto Group suspended negotiations on the aluminum price premium in the Japanese market earlier this week. According to sources, before suspending the negotiations, Rio Tinto's proposed price was $250 per ton, which was at least the highest level since 2015.
The Qatar Energy Company (a state-owned enterprise of Qatar) announced on the 3rd that, following the attack by Iran which led to the shutdown of its liquefied natural gas (LNG) plant, the company has also halted the production of aluminum and some chemical products.
The Middle East accounts for approximately 20% of the global total aluminum production (excluding that of China). If production disruptions and transportation blockages in this region persist for an extended period, once negotiations resume, the premium on aluminum prices may further increase.
The premium in the Japanese market is regarded as the benchmark for the markets in East Asia, where aluminum is the main consumer market. Although domestic demand for aluminum in Japan is weak, the rise in premiums in other regions is exerting upward pressure on aluminum prices due to the outbreak of conflicts in the Middle East.
