Global Aluminium Supply Crisis Deepens: Plunging Gulf Aluminium Output Impacts Manufacturing

Release Date: May 2026 | Source: Company Internal Industry Research & International Aluminium Institute (IAI)
The global primary aluminium supply chain is facing unprecedented structural shocks amid worsening regional logistics disruptions. Latest official data released by the International Aluminium Institute (IAI) reveals that Gulf aluminium daily output has slumped by nearly 40% compared with pre-war baseline levels, triggering continuous price hikes across the global aluminium market and bringing tangible challenges to downstream aluminium packaging manufacturers, including our factory focusing on customized thin aluminium drink containers: u shape drink cup, bubble tea cup and ice coffee cup.

According to preliminary April 2026 production statistics from IAI, Gulf daily primary aluminium production dropped sharply to 10,989 tonnes, marking a month-on-month plunge of 26.7% from March's 15,000 tonnes per day. Currently, regional aluminium output is merely 62% of the pre-conflict average daily production of 17,800 tonnes. As a core global aluminium export hub, the Gulf region occupies 8% of global primary aluminium production capacity, while supplying 19% of EU imports, 28% of Japanese imports and 21% of US imports of primary aluminium. Given the severe shipping blockage in the Strait of Hormuz, most finished aluminium products manufactured in Gulf smelters are stranded at ports with no effective delivery channels, further tightening global raw material inventory.
Jonathan Grant, Secretary General of IAI, pointed out that the April production data is not the bottom of this supply crisis, and the global aluminium shortage will continue to worsen in the next few months. Although China contributes 60% of the world’s primary aluminium output, domestic production only saw marginal growth and cannot offset the massive supply gap caused by Gulf production cuts. No other production region can rapidly fill such a large-scale supply deficit in the short term, pushing LME aluminium prices to hit a four-year high, while regional aluminium premiums in North America and Europe keep climbing continuously.

Practical Impacts on Our Thin Aluminium Cup Production, Sales and Profit Performance
As a professional manufacturer specializing in disposable thin aluminium drink packaging, our core product lines cover customized u shape drink cup, bubble tea cup and ice coffee cup, which are widely supplied to global beverage chain brands, offline milk tea stores, coffee retailers and catering distributors worldwide. The ongoing global aluminium supply crisis has exerted multi-dimensional negative impacts on our daily operation, sales volume and gross profit margin.
Firstly, raw material procurement costs have risen steadily. Thin aluminium sheets are the core raw material for producing our three mainstream cup products. The surging global aluminium spot price has directly increased our unit production cost for each aluminium cup. Compared with the first quarter of 2026, the average raw material cost of our u shape drink cup has increased by 12%, while the cost of large-capacity bubble tea cup and thickened-wall ice coffee cup has risen by 13% and 11% respectively, compressing our overall gross profit margin significantly.
Secondly, order delivery cycles are extended and inventory pressure increases. Affected by global aluminium raw material logistics delays, our upstream material arrival cycle has been prolonged by 7-10 working days. We have to maintain higher safety stock of thin aluminium sheets to ensure on-time delivery for bulk orders of bubble tea cups and ice coffee cups, which raises our capital occupation and warehouse operation costs further.
Thirdly, global market demand remains stable while supply capacity is restricted. Demand for disposable aluminium drink cups stays robust due to the booming global cold drink and bubble tea market. However, limited raw material supply restricts our maximum monthly production capacity. We have to moderately adjust order acceptance schedules for customized u shape drink cups, which brings certain pressure to our short-term sales growth.

Our Factory's Response Strategies
To mitigate the risks brought by the aluminium supply crisis, our procurement team has expanded diversified raw material supply channels, cooperating with stable domestic aluminium suppliers to reduce reliance on imported Gulf aluminium materials. Meanwhile, we have optimized the production process of thin aluminium cups to lower raw material consumption per finished product without damaging the durability and appearance of u shape drink cup, bubble tea cup and ice coffee cup. We will continue to track real-time global aluminium market trends, adjust production and pricing strategies dynamically, and guarantee stable product supply and reliable product quality for all global customers in the long run.
For more industry updates and customized aluminium cup order consultation, please contact our sales team via official email.