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Will average LME aluminum price remain above $2,500/ton for FY2026?
Current Prediction
Prediction History
Q1 2026 LME realized prices up ~10% QoQ; spot above $3,600/ton far above threshold; Middle East supply disruption tightening market
Why This Question Matters
Aluminum price is the single most important variable for Alcoa — revenue is 100% commodity-linked with no hedging. If LME aluminum stays above $2,500/ton through FY2026, it validates the 'supercycle' narrative and supports the current valuation. A decline below $2,500 would compress margins and challenge the CONSENSUS_HEAVY expectations pricing.
Prediction Distribution
Individual Predictions(1 runs)
Post-Q1 2026 earnings, LME aluminum is at $3,600+/ton with tight inventories — $1,100 above the $2,500 threshold. For the FY2026 annual average to fall below $2,500, the remaining 9 months (Q2-Q4) would need to average below ~$2,200, requiring a ~40% price collapse and sustained depression. This magnitude of decline would require a severe global recession or major Chinese capacity surge — neither is the base case given Middle East supply disruption and Section 232 regional premia. The mathematical cushion from Q1 2026 (likely $2,900-3,100 realized average) combined with current spot support pushes probability well above baseline 0.57 toward 0.85. Main downside: H2 2026 global recession could still compress prices meaningfully.
Resolution Criteria
Resolves YES if the average daily LME aluminum spot price for calendar year 2026 is at or above $2,500/ton. Resolves NO if below $2,500/ton.
Resolution Source
London Metal Exchange official settlement prices
Source Trigger
Revenue is 100% commodity-linked to aluminum/alumina pricing with no hedging or contractual floors
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