China aluminium production up 2.7% in March as Iran war drives prices higher

China’s primary aluminium production in March rose 2.7% year-on-year, official data showed on Thursday, as supply fears linked to the Iran conflict supported prices of the light metal.

Aluminium production climbed to 3.85 million metric tons in March, according to data released by the National Bureau of Statistics.

In the first three months of the year, China churned out 11.41 million metric tons of primary aluminium, a rise of 3.1% from the year-ago period, the data showed.

The Gulf region accounts for roughly 9% of global aluminium supply.

Supply concerns intensified after Iran moved to disrupt traffic through the Strait of Hormuz and amid heightened risks to major regional producers, including Aluminium Bahrain and Emirates Global Aluminium, helping lift aluminium prices.

The benchmark three-month aluminium climbed 10.41% in March, its best month since April 2024. The most-active aluminium contract on the Shanghai Futures Exchange, however, gained just over 4% in March.

Domestic demand for the light metal, used widely in manufacturing, packaging and construction, was tepid due to sharp price volatilities in March, taking aluminium stocks monitored by SHFE to a roughly six-year high in early April.

Analysts, however, said China’s export of aluminium products are now poised to grow as the Iran war tightened availability and boosted margins with higher prices. Production of 10 nonferrous metals - including copper, aluminium, lead, zinc and nickel – rose 2.2 % to 7.07 million metric tons from a year earlier. Year-to-date output was up 3.6 % at 20.53 million metric tons.

The other non-ferrous metals are tin, antimony, mercury, magnesium and titanium.