UK Aluminium Industry Faces Disruption as US Tariffs Take Effect

The Aluminium Federation (ALFED) has voiced serious concerns over the incoming 25% tariffs on aluminium imports into the US, set to come into force on 12th March 2025.

Industry Challenges and Economic Impact

Following extensive discussions with the UK Department for Business and Trade (DBT) and Sarah Jones MP, Minister of State for both the Department for Energy Security and Net Zero and the Department for Business and Trade, ALFED has highlighted the significant challenges facing the UK aluminium sector. The Federation warns of long-term implications for the industry, including potential export losses and market instability.

Immediate Concerns for UK Aluminium

The US is a key export destination for UK aluminium, representing 10% of all exports in 2024, valued at £225 million. ALFED members have already reported early signs of market disruption, including a slowdown in US orders, concerns over contract losses, and fears that semi-finished aluminium products originally intended for the US could instead be diverted into the UK market.

The sharp increase in US Midwest aluminium premiums has also triggered a surge in demand for UK aluminium scrap exports. While scrap itself is not directly affected by the tariffs, these rising premiums are driving a shift in supply, raising concerns over domestic scrap leakage. This could significantly weaken the UK’s recycling infrastructure and compromise long-term sustainability goals.

ALFED’s Response

Nadine Bloxsome, CEO of ALFED, commented:

“The UK aluminium sector is already seeing the first impacts of these tariffs. The sharp rise in US premiums has created new incentives for scrap exports, raising the risk of significant domestic scrap leakage. This not only weakens the UK’s recycling capacity but risks undermining our sustainability objectives and circular economy targets.”

“Additionally, the uncertainty around potential trade diversion is placing considerable pressure on UK producers, especially as semi-finished goods may flood the UK market at lower costs. This could severely destabilise the competitiveness of UK aluminium manufacturers, who are already contending with high energy costs and complex regulatory challenges.”

Government Collaboration and Next Steps

ALFED has welcomed ongoing discussions with the DBT and Minister Sarah Jones, ensuring that the Federation remains involved in critical conversations surrounding trade divergence and safeguarding measures.

Bloxsome added:

“We recognise the complexity of this situation and are committed to working with the Government and international stakeholders to mitigate risks and protect our sector. We have already seen the importance of government engagement, and ALFED stands ready to support discussions that ensure the long-term resilience of UK aluminium manufacturing.”

Proposal for an Aluminium Alliance

During discussions with the Minister, ALFED also emphasised the need for a dedicated Aluminium Alliance, an initiative similar to the UK’s Steel Council.

“The aluminium sector is integral to the UK’s net-zero ambitions and high-value manufacturing future,” Bloxsome stated. “A dedicated Aluminium Alliance would ensure a strategic, collaborative approach to supporting the sector, identifying opportunities, and strengthening the UK’s global competitiveness. We would welcome the Government’s support in developing this initiative and have already begun in our efforts to rally the sector and our members.”

Ongoing Commitment to the Industry

ALFED remains committed to working closely with government, industry partners, and international stakeholders. This includes continued engagement in trade discussions, advocating for domestic recyclers, and ensuring the long-term success of the UK aluminium sector amid global challenges.

For more information on ALFED or to become a member, visit: www.alfed.org.uk.