Chinese Aluminum Stocks Rally as Norsk Hydro Cuts Brazil Production by 50%

Key Facts

Amid heightened sensitivity in metal markets to global supply chain disruptions, Chinese aluminum stocks rose significantly following Norsk Hydro's announcement of a 50% production cut at its Alunorte refinery in Brazil. According to reports, this substantial reduction in operations was triggered by natural gas availability disruptions, sparking immediate concerns over global supply shortages. This development bolsters the competitive position of Chinese producers in the international market as the supply-demand balance tightens.

These supply pressures had a direct impact on global markets, with aluminum prices in London rising nearly 2% to reach $3,373 per metric ton, marking a seven-week high. This price surge coincided with LME aluminum stockpiles sinking to their lowest levels since 1990. These figures further support the positive outlook for the Chinese manufacturing sector, which reported a 23.9% growth in exports according to trade data released on August 7, 2026.

Looking ahead, traders are monitoring the stabilization of energy supplies in Brazil to assess the sustainability of this price rally. With aluminum prices currently at $3,373, market participants remain focused on global industrial production indicators as the next potential catalyst. Investors are also keeping a close watch on Brazil's trade balance data, which reported a $7.07 billion surplus on August 6, 2026, for further signals regarding the recovery of the country's commercial and industrial activity.