Since the 1980s, the United States has experienced a staggering collapse in its primary aluminium production. From nearly 4.6 million tonnes at its peak, output has dropped by more than 80%, with just under 900,000 tonnes produced in recent years. Once a powerhouse of aluminium smelting, the US now relies heavily on imports, primarily from Canada, which produces over 3.3 million tonnes annually—supplying nearly three-quarters of US consumption needs. Only six smelters remain operational in the country, while key facilities, like Hawesville and New Madrid, sit idle, awaiting economic conditions that could justify a restart.

The force behind the fall

This collapse did not happen overnight. It resulted from high domestic energy costs, tightening environmental regulations, underinvestment in modernisation and the explosion of global overcapacity, especially from China, which now accounts for more than half of global aluminium production. With energy accounting for up to 40% of smelting costs and worldwide prices largely set by countries with far cheaper power sources, the US smelting base found itself uncompetitive. As imports rose to nearly 5 million tonnes in 2017, the conversation in Washington shifted from efficiency to sovereignty.

Aluminium is not just a commodity, it is a strategic material

From aerospace and defence to electric vehicles and consumer packaging, aluminium is foundational in industries central to America’s economy and security. The resurgence of geopolitical risk, supply chain fragility exposed by COVID-19 and the accelerating transition to green technologies have only underscored this fact. Despite aluminium’s diminishing share in overall personal consumption—only about 0.4%—its importance to industrial resilience is more critical than ever.

Tariff: Policy reboots or political gesture?

The recent move by the Trump administration to double Section 232 tariffs on aluminium and steel imports to 50% reignites this debate. The official rationale is to protect national security by restoring domestic industrial capacity. The effect, in theory, could be meaningful. Restart models for idle US smelters suggest that with 50% tariffs and energy prices below USD 0.70 per pound, facilities like Mt. Holly, Warrick, Hawesville and New Madrid could become profitable once again. Margin models estimate cash returns of USD 1,700 to USD 1,900 per tonne under these conditions. These restarts represent more than 630,000 tonnes of idle capacity that could be brought back online.

Still, economics alone won’t drive this recovery. Smelters that have been idled for years require millions in capital to restart and many are based on outdated technology. The permitting process for facility upgrades, particularly concerning environmental compliance, remains slow and uncertain. Moreover, power contracts—often the decisive cost variable—are not easily renegotiated in a market where utilities have more lucrative options. Without targeted government incentives, the likelihood of widespread restarts remains tentative.

Falling behind in global aluminium growth – What does the future hold?

While North America debates its industrial future, other regions are accelerating. Between 2025 and 2027, more than 2.3 million tonnes of new global primary aluminium capacity are expected to come online. India’s BALCO and Vedanta operations, Indonesia’s new smelters under Nanshan, Adaro and Hua Chin and Brazil’s continued expansion of Alumar all reflect a momentum that the US has yet to match. Even Canada, which enjoys a cleaner grid and more favourable power economics, continues its modernisation push through projects like Rio Tinto’s AP60 cell expansions in Quebec.

At the same time, some critics of tariffs warn of cost pass-through to downstream industries—particularly automotive, beverage packaging and construction. There is truth to this. Tariffs raise input costs for manufacturers, who operate on tight margins. However, the broader inflationary impact appears limited. Even if aluminium prices rose 50% across the board, the resulting increase in overall consumer inflation would be just 0.22%, according to expenditure-weighted estimates. In other words, the economic penalty of aluminium protectionism is minimal compared to the potential industrial benefits.

This makes the current moment a rare opportunity. With tariffs in place, the US government can now complement them with strategic industrial policy. A revival of domestic smelting would require more than trade barriers—long-term low-cost energy contracts, direct investment in modernisation, streamlined environmental approvals and demand-pull from industries like defence and EV manufacturing. Secondary aluminium recycling, which accounts for over 80% of the current US aluminium supply, is already efficient and sustainable. However, recycling cannot replace the strategic value of primary production capacity in a national emergency.

The question now is whether the political will exists to act. A second Trump administration appears determined to reassert industrial sovereignty and aluminium has returned to the agenda. But protectionism alone is not a plan—it’s a lever. Whether or not the US aluminium industry can be revived depends on whether policymakers, utilities, investors and manufacturers can align around a common strategy. If not, the world will continue to race ahead—and North America will watch from behind, buying back what it once produced.