Aluminium falls on EGA alumina restart, still set for weekly rise

Aluminium prices fell sharply on Friday as Emirates Global Aluminium said it had restarted its refinery in the United Arab Emirates after a 3-1/2-month outage, in a further sign that metal production in the Gulf is on its way back. EGA's Al Taweelah refinery suspended production of alumina - a white substance used to make aluminium - on March 28 following Iranian attacks on the industrial zone that houses the plant. The strikes also forced the shutdown of the Al Taweelah smelter, which has been gradually restoring production since May 26. Alumina typically accounts for around 40% of smelters' production costs. Benchmark three-month aluminium on the London Metal Exchange fell as much as 1.5% to $3,153.50 a metric ton after EGA's announcement and was trading down 1.4% at $3,154 as of 0830 GMT. The metal, used in transport and packaging, was nonetheless on course to end the week up 2.1%, following five straight weekly losses, as renewed tit-for-tat attacks by the U.S. and Iran raise fears the conflict in the Gulf may rumble on. The Al Taweelah refinery produced 2.4 million tons of alumina in 2025 and met 46% of EGA's needs, the firm said in a statement, adding that it expected a ramp-up to 50% of capacity "within days" and to have the technical capability to restore full production by the year-end. However, the prospects for EGA's alumina and aluminium to flow through the Strait of Hormuz to export markets are uncertain and LME aluminium inventories remain at their lowest since September 2022. The cash LME aluminium contract was trading at a $7.50 a ton premium over the three-month forward , retaining its backwardation for a second day in a sign of tighter near-term physical availability. Elsewhere, copper edged up 0.1% to $13,501 a ton and was heading for a weekly gain of 0.9%. Lead was flat at $1,891.50, nickel lost 0.4% to $16,520, tin dipped 0.5% to $53,385 and zinc shed 0.4% to $3,611.