Alcoa CFO: US Aluminum Premium to Remain High Despite Potential Canada Tariff Cut

The steep premium paid for aluminum in the United States is unlikely to fall significantly even if Washington reduces tariffs on Canadian imports, as the country will still need to source metal from elsewhere to meet demand, according to Alcoa's chief financial officer.

Speaking at the Jefferies Global Industrials Conference on Thursday, CFO Molly Beerman explained that a fundamental supply-demand gap will keep U.S. prices elevated.

The Supply Deficit

The U.S. needs to import approximately 4 million tons of aluminum annually to satisfy domestic consumption, Beerman noted. However, Canada, a primary supplier, can only provide about 3 million tons of that total.

This leaves a 1-million-ton shortfall that must be filled by other international producers. "With the U.S. still needing to incent the import of a million tons, even if we were to have a favorable rate with Canada, we don’t see Midwest dropping significantly," Beerman said. She added that the premium "might come off a little bit, but we wouldn’t see it returning to pre-tariff levels."

Market Impact and Premiums

The U.S. Midwest premium, which is the price consumers pay on top of the London Metal Exchange (LME) benchmark, currently stands at $1.09 per pound ($2,403 per metric ton). This is down from a record high of $1.19 per pound in June, partly on speculation that the 50% import tariff on Canadian aluminum could be halved.

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Beerman stated that a significant reduction in the premium would likely only occur if the U.S. grants tariff relief to other trade partners, such as Japan, South Korea, or European nations, to cover the remaining import needs.

For Pittsburgh-based Alcoa, the high premium offsets the more than $1 billion in tariffs it pays to import its 900,000 tons of Canadian-produced aluminum into the U.S. "The Midwest is fully compensating us for that, as well as returning as margin because of the tightness in tons," Beerman said.

Strong Demand and Global Context

The tight North American market is compounded by constrained aluminum supplies from the Middle East. According to Beerman, this has led customers in both North America and Europe to actively seek out Alcoa's supply.

Reflecting this strong demand, Beerman noted that Alcoa’s order book was "almost completely sold out for the rest of 2026."