US Aluminium Scrap Imports Hit 3-Year High as Tariffs Spare Scrap

US aluminum scrap imports hit 580,000 t in the first half of 2026, a three-year high worth about $2.07 billion, and the metal arrived through the one door the tariff wall left open. Scrap enters duty-free while much primary aluminum faces a 50% charge at the border. So what does a buyer do when new metal costs that much more to bring in?

Scrap is closer to a core input than a side market. The Aluminum Association states that about 85% of US-produced aluminum comes from secondary sources, meaning recycled metal.

The data is fresh: AlCircle published its analysis, citing US trade statistics, in early October 2026.

Here is what the numbers show, why the tariff treatment of scrap matters, and what heavy reliance on Canada means if you hold aluminum or recycling exposure.

Three years of records: what the H1 2026 scrap numbers actually show

The first-half volumes climbed from 321,000 t in 2024 to 424,000 t in 2025, then to 580,000 t in 2026. The 2026 step is the sharpest of the three, with growth of 36.79% on the year.

A note on the data: the source lists an identical 32.09% growth rate for both 2024 and 2025, so this analysis relies only on the 2026 figure.

Quarterly momentum

Second-quarter imports beat the first quarter in all three years, but the size of the 2026 jump separates it from the pattern:

• Q2 2026: 314,000 t, up 18.05% from 266,000 t in Q1
• Q2 2025: 222,000 t, up 9.9% from 202,000 t in Q1
• Q2 2024: 167,000 t, up 8.44% from 154,000 t in Q1

A seasonal lift of 8-10% is the norm here. An 18.05% step suggests something beyond seasonality is pulling metal in.

Who supplies the tonnes

Canada supplied 369,000 t in H1 2026, a 63.62% share, up from 197,000 t in 2024 and 218,000 t in 2025. Mexico shipped 133,000 t (22.93%), slipping from 139,000 t a year earlier.

Canada added roughly 151,000 t in two years while Mexico slipped. The surge is a Canada story, and any view on US scrap supply is really a view on one neighbour.

Imports are only one side of the ledger, because domestic scrap recovery has also risen under the same tariff pressure, so recyclers are drawing metal from both home and abroad.

Why scrap escapes the tariff wall, and why secondary supply matters so much

Section 232 is a US trade law that lets the president tax imports on national security grounds. According to the 2026 USGS Mineral Commodity Summaries, the US imposed a 25% tariff on aluminum and aluminum derivatives in March and ended country-specific exemptions. By June, the rate doubled to 50% for most countries, with the UK staying at 25%.

A proclamation dated 2 April 2026 tightened the rules further. Duties now apply to the full customs value of covered goods, not just their metal content, for entries from 6 April 2026, according to C.H. Robinson.

BDO (15 April 2026) sets out the structure: 50% applies to articles and derivatives in Annex I-A, and 25% to specified derivatives in Annex I-B. The older exemptions for Canada and Mexico listed in 2022 guidance have ended, and the 2026 sources govern.

Scrap sits outside all of this. USGS lists three scrap tariff lines, all “Free”:

The mechanism works in three steps:

1. Primary metal or a covered derivative enters at 50% on its full value.
2. Scrap enters at 0%.
3. That gap shapes where buyers source their aluminum.

Secondary supply weight About 85% of US-produced aluminum comes from secondary sources, according to the Aluminum Association.

Scrap is the raw material for recyclers and rolling mills, the plants that roll aluminum into sheet. A 50% duty against zero means any buyer who can use scrap has a strong cost reason to do so, so the tariff steers tonnes toward scrap whether or not that was its aim.

What is pulling scrap north-to-south: premiums, thin unwrought supply and Canadian netbacks

Three pressures converge here. This is an inference from market data: no named analyst or company, including Novelis or Constellium, has attributed the surge to specific buyers.

1. Tariff arbitrage
2. Thin unwrought supply
3. European competition for Canadian metal

Tariff arbitrage

Zero duty on scrap sits against 50% on the full value of covered goods. The Midwest premium, the extra price US buyers pay over the London benchmark for delivered metal, shows the pressure: Platts had it at 91.05 c/lb on 31 December 2025, up 55% since 4 June 2025.

It reached a record $1.16/lb (about $2,557/t) in May 2026. Reuters reported in January 2026 that the all-in price had topped $5,000/t.

Thin unwrought supply

Unwrought aluminum is raw metal not yet worked into products. S&P Global reported that US imports fell 25% in 2025 to 1.54 million t, 70% of it from Canada.

Canadian unwrought exports to the US CRU data shows shipments of 250,096 t in March 2025 fell to 142,756 t by December 2025, about 56% of the earlier rate.

Record premiums did not draw in enough metal. Scrap became the obvious substitute for feeding smelters and mills.

Europe’s pull on Canadian metal

Bloomberg reported that Canada’s share of US aluminum imports fell from 75% in Q1 2024 to 63% in Q1 2025 and 54% in Q1 2026. European duty-paid premiums rose 73% since the Iran war began, to a record $621/t. This share measures all aluminum imports, so do not compare it directly with the 63.62% scrap share.

Canadian producers chase the best netback, the return after costs. While primary metal stays costly, scrap is the cheapest route to aluminum units, so the surge reflects incentives you can track, not a one-off.

Canadian exports to Europe have climbed sharply as producers redirect tonnes toward higher duty-paid premiums, which tightens the pool of metal available to US buyers and raises the stakes for scrap sourcing.

Structural dependence or a cyclical windfall? Risks investors should weigh

The honest answer is that the evidence supports both readings, and the risks decide which one wins.

Two ways to read the data

No published debate frames this explicitly as structural versus cyclical, and there are no dated corporate investment announcements or recent US scrap price benchmarks to settle it. Treat one half-year of data with caution.

The Aluminum Association’s supply chain strategy pairs recycling growth with new smelting capacity, a mix that shapes whether heavy reliance on imported scrap becomes a lasting feature or a temporary patch.

Risks that could change the picture

• Policy reversal: the April 2026 proclamation shows scope and valuation can change by executive action, and scrap could be pulled into the tariff net.
• Premium volatility: a narrower Midwest premium would erode the scrap advantage.
• Supply redirection: Canada is reorienting exports toward Europe, and some tariff arrangements run to at least 2027.
• Operational issues: more imported scrap raises sorting and melt-loss questions, though no trade-press warnings were found.

S&P Global (September 2026) argues that modest US tariff cuts on Canadian aluminum would not lower the premium much. If you hold US recyclers, rolling mills or aluminum prices, your results depend on both Washington’s tariff decisions and Canadian allocation choices.

Reading the scrap signal: what to track as tariffs and premiums move

The H1 2026 jump is real and Canada-led, scrap’s tariff-free status is the lever, and the 85% secondary weight makes the flow important whatever the cycle.

Three indicators will tell you whether the trend holds: any change to the three scrap tariff lines, the gap between Midwest and European premiums, and the direction of Canadian exports.

Treat tariff-free scrap as a current condition, not a guarantee, and judge each position against those signals.

This article is for informational purposes only and should not be considered financial advice. Investors should conduct their own research and consult with financial professionals before making investment decisions. These statements are speculative and subject to change based on market developments.