China aluminium boom to continue as copper eyes recovery in 2026

China’s aluminium exports jumped sharply in May as the world’s largest producer moved aggressively to fill global shortages caused by the ongoing Middle East conflict.

At the same time, copper prices held relatively steady on Tuesday as tensions eased after both Iran and Israel agreed to halt attacks on each other, with traders now shifting focus to upcoming Chinese economic data.

Aluminium exports rise significantly

According to Chinese customs data released on Tuesday, aluminium exports from China climbed 16% year-on-year to 630,000 tonnes in May.

This marks one of the strongest monthly performances in recent years and reflects Chinese smelters’ efforts to capitalise on elevated international prices and supply disruptions stemming from the Iran-related conflict, according to a Bloomberg report.

The Middle East war has severely affected regional aluminium production and logistics, creating opportunities for Chinese exporters.

Higher global premiums and strong demand from Europe, the United States, and other Asian markets have encouraged Chinese producers to ramp up shipments, according to the report.

This surge is helping to partially offset the shortfall left by constrained supplies from traditional producers.

Copper market finds temporary stability

Copper prices showed resilience on Tuesday, holding earlier gains as immediate geopolitical risks receded.

The announcement of a halt in attacks between Israel and Iran helped reduce fears of a wider escalation that could have disrupted broader commodity supply chains. However, both countries warned that they could resume strikes if the agreement falters.

However, the market remains cautious. Renewed expectations of higher US interest rates and concerns over technology sector weakness, particularly related to artificial intelligence investments, continue to act as counterweights, according to a Bloomberg report on Tuesday.

A stronger US dollar also makes dollar-priced metals more expensive for buyers using other currencies, limiting upside potential.

China trade data in focus

Market participants are now closely watching upcoming Chinese trade figures. Crude oil imports into China fell to an eight-year low in May due to the persistent closure of key shipping routes in the Persian Gulf.

This decline has broader implications for industrial metals demand and pricing dynamics across Asia. Analysts anticipate mixed results for base metals imports.

While aluminium exports are booming, copper imports are expected to show more moderate growth or even slight declines amid domestic economic uncertainties and high inventory levels in some sectors.

Iron ore imports will also be monitored for signals on China’s steel production outlook.

Diverging trends in base metals

The contrasting performance between aluminium and copper underscores the uneven impact of the current geopolitical environment.

Aluminium has benefited directly from physical supply shortages and attractive export margins. Copper, while supported by long-term structural demand from electrification and renewable energy, remains more sensitive to short-term macroeconomic signals and monetary policy expectations.

The Middle East conflict, now entering its fourth month, continues to create volatility.

Although the recent halt in attacks from Iran and Israel provided some relief, underlying risks around the Strait of Hormuz and US-Iran negotiations remain unresolved, keeping traders on edge.

Broader market context

China’s increased aluminium exports are playing a stabilising role in global markets by helping to bridge supply gaps.

However, this also raises questions about the sustainability of such high export levels and potential impacts on domestic availability later in the year.

For copper, the market is balancing hopes of eventual supply recovery from the Middle East with near-term demand concerns from major economies.

Any signs of stronger Chinese industrial activity or easing monetary policy in the US could provide fresh support to prices.

Outlook for the coming months

Chinese producers are likely to sustain elevated aluminium export volumes in the near term as long as global prices remain supportive.

For copper, the direction will depend heavily on developments in US-Iran talks, Chinese economic indicators, and Federal Reserve policy signals.

Analysts believe that while near-term volatility will persist, the long-term outlook for both metals remains constructive due to global energy transition needs and infrastructure spending.

However, the timing and scale of any recovery will be heavily influenced by how quickly Middle East supply disruptions are resolved.

The coming weeks will be important as fresh Chinese trade data and other economic indicators provide more clarity on demand trends.

For now, China’s proactive export strategy in aluminium is helping to mitigate some of the global supply pain caused by the conflict, while copper continues to navigate a complex mix of geopolitical relief and macroeconomic uncertainty.