When Critical Infrastructure Meets Reality

After decades of surplus, we might be "sleepwalking into the biggest aluminum deficits in 20 years." China produces 60% of global aluminum but has hit a production cap at 45 million tons annually. Exchange inventories dropped from 3 million tons four years ago to just 700,000 tons today.

Russian sanctions are redirecting metal away from London exchanges. Outside China, smelters keep closing due to energy costs. Indonesia offers hope for new capacity, but realistic estimates suggest only 2.3 million tons by 2030, far short of the 7 million tons on paper.

Citi expects prices to jump from $2,700 per ton to over $3,000 just to prevent shortages. This hits US automakers, aerospace companies, and renewable energy projects directly. Global supply chains built around cheap aluminum face fundamental restructuring.

America's Last Magnesium Producer Goes Bankrupt

US Magnesium, America's only primary producer of this critical defense material, filed Chapter 11 bankruptcy on September 10. The company fought Utah regulators over environmental violations while dealing with equipment failures and $400 million in failed lithium investments.

China controls 85% of global magnesium production. Russia supplies much of the rest. US Magnesium was the only barrier between American defense contractors and complete foreign dependence for materials used in aircraft and missiles.

Supply Chain Reality Check

Both crises expose how vulnerable critical material flows have become. US manufacturers now face higher aluminum costs and potential magnesium shortages simultaneously. Global supply chains assumed these materials would always be available and cheap.

The ripple effects reach beyond manufacturing. Defense contractors may need to redesign products around available materials. Auto companies could see electric vehicle costs rise. Construction and packaging industries face margin pressure.

Sometimes the biggest risks hide in plain sight.

In a world of black swans and cascading disruptions, this is what resilience in action looks like.