Goldman Sachs(US:GS) Hua Er Jie Jian Wen·2026-01-28 07:59Core Viewpoint - Goldman Sachs has adjusted its aluminum price forecast, raising the target price for the first half of 2026 to $3,150 per ton, driven by low global inventories, uncertainties in Indonesia's new capacity power supply, and sustained demand in the renewable energy sector. However, the firm maintains a bearish long-term outlook for aluminum prices, predicting a decline to $2,500 per ton by Q4 2026 and an average of $2,400 per ton in 2027 [1][4][6]. Short-term Price Drivers - The recent price increase is supported by three main factors: 1. Global aluminum inventories are at low levels, with coverage days decreasing from approximately 50 days in 2023 to 46 days in 2025, which supports spot premiums and bullish market expectations [4]. 2. There are concerns regarding the power supply capabilities of Indonesia's new aluminum smelting capacity, which may not meet production expectations, reinforcing supply tightness [4]. 3. Rapid growth in the renewable energy sector, particularly in electric vehicles and grid construction, has significantly boosted end-user demand for aluminum, providing strong fundamental support for prices [4]. Long-term Bearish Logic - Goldman Sachs highlights a long-term bearish outlook due to accelerated supply release and slowing demand growth: 1. Indonesia is becoming a key player in global aluminum capacity expansion, with expected production increases of 725,000 tons in 2026 and 900,000 tons in 2027, reaching a total of 4.25 million tons by 2030 [6]. 2. Other regions, including Saudi Arabia, Kazakhstan, and Angola, are also expected to gradually release smelting capacity after 2027, while China is projected to increase its primary aluminum production to 46.2 million tons by 2029 [6]. Demand-side Pressures - The demand side faces structural pressures: 1. Aluminum demand in the photovoltaic sector is expected to decline year-on-year in 2026-2027, with the unit aluminum intensity of photovoltaic components projected to decrease from 7.3 tons/MW in 2025 to 5.1 tons/MW by 2030 [9]. 2. Although electric vehicles use more aluminum per unit, the global production and sales growth forecasts for electric vehicles have been downgraded, leading to lower-than-expected demand support for aluminum [9]. Global Supply Chain Transformation - The Chinese aluminum smelting industry is driving structural changes in the global supply landscape through systematic output of technology and models, significantly reducing construction costs and improving efficiency [10][13]. - This efficient capacity expansion model is rapidly being implemented in Southeast Asian countries like Indonesia and Vietnam, which may continue to exert downward pressure on the long-term equilibrium level of global aluminum prices, similar to the impact of China's domestic capacity expansion from 2007 to 2025 [13].