JP Morgan predicts global aluminium deficit to exceed 600,000 tons in 2025

March 5 (Reuters) - JP Morgan on Wednesday predicted a severe tightening of the global aluminium market, with a deficit of more than 600,000 metric tons this year, driven by lower Chinese supply and looming U.S. import tariffs on the metal.

However, it said in a note that a rise in aluminium prices in the United States on the back of 25% import tariffs would make it more likely that idled production in the country would be restarted, adding that in Europe, restarts would be dictated by margins.

Around 630,000 metric tons of annual aluminium production capacity is idled in the U.S. and one million tons in Europe, according to the bank.

It forecast one million tons of restarts over the coming years, about 360,000 tons per year in the U.S. and 650,000 a year in Europe.

"We still think deficit fundamentals continue to point towards aluminium prices trading higher to $2,850/mt in 4Q25 in order to stimulate needed restarts," JP Morgan said.

The three-month aluminium contract on the London Metal Exchange CMAL3 is currently trading at $2,640.50 a ton.

Despite tariff risks, the bank forecast annual global demand growth of around 2% in 2025, driving a tightening market through the year.

Trump's 25% tariffs on imports from Mexico and Canada took effect on Tuesday, with duties on steel and aluminium due to be implemented from March 12.