Aluminum prices have surged to their highest levels since 2022, driven by the aftermath of the Iran war and subsequent disruptions in the global supply chain. Since the U.S.-Israeli strikes on Iran on February 28, aluminum on the London Metal Exchange has risen more than 13%, and is up around 19% so far in 2026. The shutdown of the Strait of Hormuz, a critical passageway for Middle Eastern aluminum exports, has been a key factor, with Bernstein analyst Bob Brackett estimating that 7% of the world's aluminum is sourced from the region. Military strikes have damaged facilities, removing about 3% of global supply from the market [1].
These price increases are significantly impacting major manufacturers. Ford's Chief Financial Officer, Sherry House, stated that the Iran war is clouding the automaker's outlook for aluminum, which is essential for its F-150 pickup truck. Ford now expects commodity headwinds to exceed $2 billion, roughly double its previous estimate, primarily due to higher aluminum costs. House noted the difficulty in predicting 2027 performance given ongoing commodity volatility and highlighted that shortages were already present before the Middle East conflict. Ford shares have fallen 17% since the Iran war began, in contrast to the S&P 500's 5.7% gain over the same period. However, UBS analyst Joseph Spak suggested that Wall Street's concerns may be 'overblown,' as Ford has hedged its aluminum exposure for this year [1].
Molson Coors has also been affected, with finance chief Tracey Joubert reporting that rising aluminum prices added approximately $30 million to the company's cost of goods sold in the first quarter compared to the prior year. The company anticipates further aluminum inflation in the current quarter. Keurig Dr Pepper's CFO, Anthony DiSilvestro, identified aluminum as one of several commodities experiencing price hikes due to the Iran war, and indicated that if elevated costs persist, the company will implement mitigation plans to protect margins [1].
Looking ahead, Wall Street does not expect relief in the near term. UBS forecasts aluminum supply growth of just 0.3% in 2026, suggesting continued tightness in the market [1].
CONCLUSION
The surge in aluminum prices following the Iran war is exerting significant cost pressures on major manufacturers such as Ford, Molson Coors, and Keurig Dr Pepper. With supply disruptions expected to persist and limited growth in global output, companies are bracing for continued volatility and elevated costs in the near term.