Any easing for aluminium supply from a possible reopening of the Strait of Hormuz is described as likely to be short-term.
Guinea, which produces 40% of global bauxite, plans to cap bauxite exports at 150 million tons. This is nearly 20% below last year’s level.
The export limit would reduce bauxite availability over the rest of the year. The stated aim is to support global bauxite prices and mining company margins.
If the 150 million ton quota stays in place, bauxite prices may rise and aluminium prices may follow over time. About 35 million tons of aluminium can be produced from 150 million tons of bauxite.
The article says it was produced using an Artificial Intelligence tool and reviewed by an editor.
Last year, we were watching Guinea’s plan to cap bauxite exports, and now in mid-2026, this is a market reality. The squeeze on this key raw material is a primary driver for aluminum prices. Recent customs data confirms that China’s bauxite imports from Guinea fell by nearly 15% in the first quarter of this year compared to the same period in 2025, tightening available supply.
This fundamental tightness is directly supporting metal prices, which is why we see LME aluminum holding firm around the $2,750 per tonne mark. This represents a nearly 12% increase from this time last year. The market’s focus has clearly shifted from short-term logistics to this more permanent upstream supply constraint.
Given this reality, holding long positions in aluminum futures contracts appears to be a logical strategy for the coming weeks. The high cost of bauxite provides a strong price floor, limiting downside risk. We expect this fundamental support will fuel further price gains through the summer.
For those looking to manage risk, buying call options provides a way to capture potential upside with a fixed cost. Implied volatility has risen, reflecting the supply uncertainty, which makes options more expensive but also confirms the market’s bullish outlook. A bull call spread could be used to reduce the premium paid while still positioning for a steady price increase.
We see parallels between this situation and Indonesia’s bauxite export ban a decade ago, which caused a significant price shock and a multi-year adjustment for smelters. Historically, these major disruptions in raw material supply chains are not resolved quickly. This suggests the upward pressure on aluminum prices will likely persist well beyond the next few weeks.
