Around 21% of global alumina flows typically move into the Arabian Gulf, which accounts for roughly 9% of global aluminium production. With the Strait of Hormuz effectively constrained, these inflows have been disrupted, limiting feedstock availability to the region. Vessel movements reflect this bottleneck, with laden Kamsarmax vessels such as the Aquaruby, Timorsun, and Macheras observed drifting in the Arabian Sea in recent days, awaiting clearance to transit through the Strait in order to discharge alumina cargoes in the Arabian Gulf.
At the same time, gas shortages have further curtailed smelter activity across the Middle East, while reported attacks on facilities have compounded the disruption. With alumina unable to flow into the region and capacity offline, aluminium production has declined. But more importantly, the impact may extend beyond the near term, as repairing and restarting smelters is both time-consuming and capital-intensive, potentially weighing on longer-term alumina demand.
From a freight perspective, alumina shipments into the Arabian Gulf are largely carried on bulkers across the Panamax and minor segments, with Panamaxes accounting for around 42% of volumes, followed by Handysizes (30%) and Supramaxes (28%). These vessels are typically loaded in major alumina-exporting countries, led by Australia at roughly 40%, with Brazil contributing around 20%, and Indonesia about 10%.
Overall, the disruption to alumina inflows into the Arabian Gulf, driven by logistical constraints, gas shortages, and damage to key facilities, is weighing on regional aluminium production. It remains unclear which regions could ramp up aluminium output in response, with smelters in Europe and Mozambique cited as possibilities, and the rigidity of China’s 45 Mtpa aluminium production cap also being tested. So far, we have not observed any diversions in alumina cargoes originally bound for the Arabian Gulf, highlighting the difficulty of redirecting these flows. Even if transit through the Strait of Hormuz resumes, the repair and restart of smelters will be gradual and costly, suggesting a softer outlook for alumina seaborne trade in the near to medium term.