Citi Sees Aluminum Prices Surging to $4,000 in Second Half of 2026

Citi's analyst Wenyu Yao expects aluminum prices to average around $4,000 per metric tonne in the second half of 2026, nearly a 12% increase from current levels. This optimism comes as gold and silver prices have declined significantly from their highs this year, due to soaring Treasury yields and a firm dollar.

The conflict in the Middle East has led to supply shocks that are expected to send aluminum inventories to all-time lows, further bolstering higher prices for the metal. China, which accounts for nearly 60% of the world's primary aluminum supply, is rapidly ramping up output despite capacity constraints.

Aluminum's supply-driven shock is unlike previous downturns, where weaker demand and eventual supply rationalization loosened the market. The current supply squeeze will push prices higher regardless of increases in demand, making this metal a 'most bullish set-up' in more than 50 years.