Rio Tinto Shifts Strategy Amid US Tariffs, Buying Aluminum Locally

Rio Tinto Group is now buying aluminum in the US and reselling it to American customers due to President Trump's 50% tariff on aluminum imports. The shift in strategy was described by people familiar with the move. The US aluminum industry doesn't produce enough metal to satisfy the domestic market, and with fewer imports, American aluminum buyers will rely more on dwindling US stockpiles. Rio has purchased at least 50,000 tons of aluminum from the US spot market since June.

Rio Tinto Group, one of the world's largest aluminum producers, has adapted its operations to President Trump's 50% tariff on aluminum imports, leading to a shift in its supply strategy. The company, which operates refineries and smelters in Canada's Quebec province, is now buying aluminum in the US and reselling it to American customers [1].

Previously, Rio Tinto shipped a significant portion of its aluminum from Canada to the US market. However, the 50% tariff, effective since June, has made it more cost-effective for the company to purchase aluminum from US suppliers. This strategic move was described by individuals familiar with the shift, who requested anonymity to discuss sensitive commercial matters [1].

The US aluminum industry's production capacity is insufficient to meet domestic demand, and with fewer imports, American aluminum buyers will increasingly rely on dwindling US stockpiles. Since June, Rio Tinto has bought at least 50,000 tons of aluminum from the US spot market, compared to the 723,000 tons shipped to the US in the first half of the year [1].

While aluminum prices in the US have surged above global benchmarks due to the tariff threat, Rio Tinto's operations in Quebec remain advantageous due to cheap hydroelectric power and easy transportation links. The company's Canadian-made aluminum, however, has incurred gross costs of $321 million due to the tariffs in the first half of 2025 [1].

The shift in strategy highlights the complex dynamics of the global aluminum market and the impact of trade policies on corporate operations. For investors, this move underscores Rio Tinto's adaptability in navigating geopolitical risks and aligning its operations with market conditions.

References:
[1] https://www.bloomberg.com/news/articles/2025-08-28/tariffs-turn-aluminum-maker-rio-tinto-into-buyer-in-us-market