Breaking through the $3200 mark! With the help of a weak US dollar, aluminum prices have surged to a four-year high.

After President Trump expressed satisfaction with the recent depreciation of the US dollar, the US Dollar Index (DXY) plummeted and hit a new low in four years, boosting the prices of base metals priced in US dollars. Among them, aluminum prices rose to the highest level in nearly four years. As of the time of writing, London Metal Exchange (LME) aluminum futures rose by 0.34% to $3210.35 per ton. On Tuesday, when asked by reporters whether he was concerned about the depreciation of the US dollar, Trump said, "No, I think the dollar is doing well. I hope it returns to its rightful level, which is a reasonable thing to do." Trump's remarks further intensified the downward trend of the US dollar, with the US Dollar Index dropping to 95.51 at one point, reaching its lowest level since February 2022. Base metals have shown strong performance at the beginning of 2026. In addition to the boost brought by the weakening of the US dollar due to Trump's inconsistent policy decisions and attacks on the Federal Reserve, base metals have also benefited from the rotation of investors towards hard assets stimulated by the so-called "currency devaluation trading." At the same time, tight supply and demand have provided support for the rise in aluminum prices. On the demand side, demand for aluminum for new energy vehicles continues to grow steadily, expected to contribute millions of tons of incremental demand for aluminum in 2026; increased investment in the US power grid can also support aluminum demand; rapid development in the energy storage sector is expected to bring 570,000 tons of aluminum demand in 2026. Currently, the copper-to-aluminum ratio is at 4.2, downstream industries are systematically replacing copper with aluminum technologies and production lines driven by cost considerations, and there is room for increased aluminum demand in sectors such as new energy vehicles, power transmission and distribution, and air conditioning, with the air conditioning sector alone expected to drive an additional demand of about 300,000 tons of aluminum annually. On the supply side, China's electrolytic aluminum production capacity is constrained by a limit of about 45 million tons, and it is unclear how quickly producers in other parts of the world can increase aluminum production to meet the growing demand. Indonesia, as a major contributor to global aluminum production capacity growth, is expected to add 900,000 tons of new production in 2026, but projects face challenges in electricity supply. In other overseas regions, issues such as outdated equipment and facilities, thin profit margins, and difficulties in restarting production exist, and new production capacity is expected to be put in place by 2030. Goldman Sachs recently raised its forecast for LME aluminum prices in 2026 from $2575 per ton to $3150 per ton in a report, stating, "Given the strong performance of aluminum prices and continued bullish sentiment among investors, we have raised our forecast for aluminum prices." However, the bank has been one of the more pessimistic institutions regarding aluminum prices in recent months, and its latest forecast is still below the current level of aluminum prices. In addition, Goldman Sachs slightly lowered its expectation of oversupply in the aluminum market in 2026 to 800,000 tons, down from 1.1 million tons previously; it maintained the expectation of oversupply in 2027 at 1.6 million tons and raised the expectation of oversupply in 2028 from 1.25 million tons to 2.3 million tons.