Aluminium producers in the U.S. win from Trump's tariffs

Century Aluminum and Matalco benefit from Trump's tariffs, but concerns arise over potential price hikes and demand impact.

Century Aluminum, the largest primary aluminium producer in the U.S., and top recycler Matalco will be among the big winners from President Donald Trump's higher tariffs on imports of the metal as domestic prices surge, four industry sources said.

However, some sector players are worried that Mr. Trump's move from June 4 to hike the tariffs to 50%, from 25%, could push prices so high that demand starts to weaken.

Higher revenues for U.S. aluminium producers and recyclers are expected mainly due to the way the market prices the metal key for construction, power and packaging industries.

The companies typically charge customers the London Metal Exchange aluminium price plus a physical market premium to cover other costs including freight and taxes.

The so-called Midwest premium hit a record 62.5 U.S. cents a lb, or $1,377 a metric ton, on Friday. Since Trump was elected for his second term in November, it has surged nearly 190%.

Consultancy Harbor Aluminum said the premium would have to rise to 70 cents a lb, or $1,543 a ton, to fully reflect the 50% tariff.

Century, in which London-listed miner Glencore is the top shareholder with a stake of more than 40%, declined to comment beyond a statement it issued last week, in which it welcomed the 50% tariff.