2025-10-21 13:32Summary of J.P. Morgan Aluminium Dashboard Industry Overview - Industry: Aluminium - Global Demand: Increased by 2% year-to-date (YTD) through August, with China up 3% and the Rest of the World (RoW) up 1% [1][2] - Production: China's aluminium production is approximately 44 million tonnes per annum (Mtpa), nearing its production cap [1] - Inventories: Global visible aluminium inventories stand at 1,130 kilotonnes (kt), remaining below 2024 levels despite a recent increase of about 300 kt over the past three months [1] Key Insights - Price Dynamics: Aluminium prices have risen by 12% YTD, underperforming copper, which has increased by 22% [1] - Alumina Prices: Alumina prices have decreased by 50% YTD, positively impacting margins, with the alumina/aluminium linkage rate at historical lows of 11% compared to a long-term average of 17% [1] - Future Market Outlook: The forward curve indicates a slight contango, with expectations of a looser market by 2026 due to significant supply additions from Indonesia [1][2] Production and Demand Forecast - 2026 Projections: Global primary aluminium production is expected to rise by 2.7% year-over-year (YoY), driven by a 5% increase in ex-China output, particularly from Indonesia, which is projected to add over 1.2 million tonnes of new supply [2] - Market Surplus: Anticipated modest surplus of approximately 400 kt in 2026 as demand growth slows to 2.1% YoY [2] Investment Recommendations - Overweight Calls: J.P. Morgan's key Overweight recommendations for aluminium exposure include: - Rio Tinto (RIO AU/RIO LN) - Norsk Hydro (NHY NO) - Press Metal (PMAH MK) [1] Financial Metrics of Key Companies - Rio Tinto Ltd.: Market cap of $118.2 billion, EV of $136.6 billion, with a target price of $137.0, indicating a 5% upside [5] - Norsk Hydro: Market cap of $13.8 billion, EV of $15.9 billion, with a target price of $74.0, indicating a 6% upside [5] - Press Metal: Market cap of $12.2 billion, EV of $13.1 billion, with a target price of $6.8, indicating a 9% upside [5] Additional Insights - Alumina Production: China's alumina production is projected to increase from 79.8 million tonnes in 2023 to 83.7 million tonnes in 2024 [19] - Global Production and Demand Summary: Global aluminium production is expected to rise from 143.3 million tonnes in 2023 to 146.9 million tonnes in 2024, with a corresponding increase in demand [17] This summary encapsulates the key points from the J.P. Morgan Aluminium Dashboard, highlighting the current state and future outlook of the aluminium industry, along with investment recommendations and financial metrics of key players.