Goldman Sachs Predicts 900,000-Ton Q2 Aluminum Deficit, Warns 45-Day Inventories
Goldman Sachs analysts forecast a 900,000-ton aluminum deficit in Q2, cutting global inventories to cover just 45 days of consumption. They warn supply disruptions have driven LME futures up 4.8%, with billet prices surging 63% and spot premiums hitting a $61.23-per-ton backwardation high.
1. Goldman Sachs Deficit Forecast
Goldman Sachs analysts project a 900,000-ton aluminum shortfall in the second quarter, citing disruptions at major Middle Eastern smelters and eroded inventories after recent strikes.
2. Inventory Coverage Shrinks to 45 Days
The forecasted deficit would reduce global aluminum stocks to just 45 days of consumption, the lowest buffer in years, heightening concerns over the market’s ability to absorb further shocks.
3. Price Surges and Market Reaction
LME aluminum futures have risen as much as 4.8%, European billet prices are up 63%, and spot premiums have reached a $61.23-per-ton backwardation, reflecting acute supply tightness.
4. Implications for Industrial Consumers
Extended supply constraints could force temporary factory shutdowns and drive up production costs, since restarting idled smelters is time-consuming and capital-intensive.