Cutting Canada tariffs alone won't flatten US aluminium premium, Alcoa says
The steep premium paid for aluminium in the US will not drop significantly even if Washington halves the tariffs on metal from neighboring Canada, because imports from other countries will still be needed, Alcoa's finance chief said on Thursday.
The price US consumers pay on top of the London Metal Exchange benchmark for physical aluminium, known as the Midwest premium, is high at $1.09/lb, or $2 403 a ton, but has eased from a record $1.19 in June on hopes the 50% import tariff could be halved for Canadian material.
Speaking at the Jefferies Global Industrials Conference in New York, Alcoa CFO Molly Beerman noted that the US needed to import around four-million tons of aluminium a year and Canada could only supply three-million tons of that.
"With the US still needing to incent the import of a million tons, even if we were to have a favorable rate with Canada, we don't see Midwest dropping significantly," Beerman said. "It might come off a little bit, but we wouldn't see it returning to pre-tariff levels."
If there is tariff relief or waivers for other trade partners - such as Japan, South Korea or Europe - and the last one-million tons is covered, "then you can expect the Midwest premium to reduce in response to essentially wipe out the tariff benefit," Beerman said.
Pittsburgh-based Alcoa produces around 900 000 tons a year of aluminum in Canada and is paying more than $1-billion in tariffs to bring most of it into the US, Beerman said. "However, the Midwest is fully compensating us for that, as well as returning as margin because of the tightness in tons."
With aluminium supplies from the war-hit Middle East constrained, customers in North America and Europe are "actively looking for our supply," Beerman said, noting that Alcoa's order book was "almost completely sold out for the rest of 2026."
Article Enquiry
Email Article
Save Article
Feedback
To advertise email advertising@creamermedia.co.za or click here
Research Reports
Projects
Latest Multimedia
Latest News
Showroom
SABAT Batteries is a renowned brand in the battery industry, manufacturing a wide range of batteries at its state-of-the-art production facility in...
VISIT SHOWROOM
Sulzer South Africa, established in 1922, partners with critical industries like power, oil & gas, water, mining, and chemicals to boost...
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
