The latest boom was triggered by news of a weekend military coup in Guinea, a major producer of bauxite, which is processed into alumina and then into primary aluminum.
The aluminum market usually pays little attention to bauxite supply chain disruptions. After all, it is the most abundant metallic element, accounting for about 8% of the earth's crust, and historically, production losses have usually been quickly offset.
No one expects things to be different this time around, even assuming that the leaders of the military coup were willing to jeopardize one of the country's main sources of foreign income.
However, the political turmoil in Guinea is catching the aluminum raw material chain at a vulnerable moment, when alumina prices are already rising due to problems with refineries in Brazil and Jamaica.
It is also fueling a new bullish narrative for the aluminum market, which, after years of oversupply, is facing the possibility of significant and persistent shortages.
The global bauxite and alumina supply chain is highly globalized and, as the events surrounding the US Rusal sanctions in 2018 showed, surprisingly sensitive to unexpected kinks in the chain.
